Senate Standing Committee on Judiciary

Get it out of the way.

All right? Good morning. Senate Judiciary Committee will come to order. The Senate continues to welcome the public in person testimony and also via teleconference service for individuals wishing to provide public comment. Today's participant number is 877-226-8216, and the access code is 997-9347. We're holding our committee hearings today in the O Street Building. I ask all Members of the committee to present themselves in room 2100. So far, we're a committee of one.

Lots of activity going on today hearings, both in the Capitol as well as in the spring space. And I know a number of Members of this committee have other commitments, either on their own bills or other committees. But nevertheless, I'd ask that those who are within earshot present themselves in room 2100 so we can establish a quorum. Let me mention a couple of housekeeping things today. First, in terms of order presentation, I see Assemblymember Wilson is here.

We're going to begin with items one and two presented by Assemblymember Wilson. AB 779. AB 868. And I understand that Assemblymember Wilson is also going to present item number seven, AB 1472, on behalf of Assemblymember Alvarez. One important housekeeping matter on AB 1228 by Assemblymember Holden, at the request of the proponents, AB 1228 has been removed from today's agenda. Let me repeat that.

If you're on the phone lines, or if you're here waiting for AB 1228 to be heard, it is not going to be heard today. That doesn't mean that this Bill is not going to be heard this year. And in fact, it is going to be heard. It's going to be heard before we recess in September.

Either in August or September, I'm going to be requesting a rule waiver, and I believe that that rule waiver will be granted so that we can have this hearing in August or September. I'm working with leadership, and I have confidence that the rule waiver will be granted. My expectation is on AB 1228. I realize there are a number of moving parts that both sides or all sides will sit down and continue to negotiate a global agreement. Period. I believe so.

That there's not any misconceptions, given the history of this Bill and my history with this Bill or this issue, that franchisors at some point in time when the franchisor knows that there's been a violation by a franchisee repeated violations and fails to act. That at some point a franchisor does incur responsibility if they fail to act when they have knowledge.

I'm hoping again that all sides continue to negotiate so that when we return in August and we have a hearing that this issue, if not resolved, at least as nearly resolved, so that we can hear the Bill. All right, having said that, let me note the bills that are on consent today. And also let me note that item number 23, AB 486, by Assembly Member Kalra has been pulled by the author. In other words, it's not going to be heard.

So we have seven items on the consent calendar today. They are as follows. File number ten actually, I'm going to wait just a second for folks to be able to both leave and come back into the hearing room. All right, for those of you who are watching and listening, we're going to make sure we provide accurate information in terms of the access code. And I'll come back to that in just a moment. But let's return now to the items that are on the consent calendar.

File item number ten AB 448 by Assembly Member Juan Carrillo with amendments. File number eleven AB 1404 by Assembly Member Wendy Carillo with amendments. File number 16 AB 844 by Assembly Member Gibson. File number 22 AB 458 by Assembly Member Jones-Sawyer. File number 31 AB 1029 by Assembly Member Pellerin. File item number 34 AB 81 by Assemblymember Ramos. And finally, file item number 43, AB 1327 by Assembly Member Weber, with amendments.

All right, we now have four, two more, and we will have a quorum here. But what we're going to do is we're going to start as a Subcommittee. And let me just go over the ground rules. Some of the folks that have been here before, they're familiar with the ground rules, but let me repeat them one more time. Each Bill today will have two witnesses, two primary witnesses in support and two primary witnesses in opposition.

It's not required, but if you have two witnesses, each of those witnesses will be afforded two minutes after the main witnesses in support speak. We'll then entertain those in the hearing room to approach the microphone and provide what's known as Me Too testimony and support. What that means is you'll identify yourself, your affiliation, and your position on the Bill. We'll then turn to the opposition, the opposition. Same thing, two minutes each, two witnesses. After the opposition, primary witnesses testify.

Then those who are opposed may approach the microphone and give us your name, your affiliation and your position. Then, after support and opposition each have testified, then we will turn to the phone lines. And on every Bill today, there's a 15 minutes limit on the phone line. That means that on some bills, some folks who are waiting on the phone line will not be able to provide their Me Too testimony.

However, if you wish to have your voice heard, you may submit a letter or a writing to the committee using one of the methods described on the California State Senate Judiciary Committee's website. All right, we'll now hear from our first author. But before we do, let me make sure that we have provided the accurate access number. So if you wish to call in today, the participant number is 877-226-8216 and the access code is 570096. I'm going to repeat the access code. Access code today is 570096.

All right, Assemblymember Wilson, AB item number one AB 779.

Good morning, Mr. Chair, Senators. After a severe drought and volatile weather exacerbated by the climate crisis, California has increasingly been forced to rely on groundwater to meet its demand for water. In particular, groundwater is a lifeline for California farmers, specifically for small farmers who have difficulty accessing or affording alternative sources of surface water. In response to persistent conditions of extreme drought and concerns over groundwater depletion, the California Legislature enacted the Sustainable Groundwater Management Act, SGMA in 2014.

SGMA requires local and regional agencies to formulate plans to ensure sustainable groundwater use on a basin wide basis. The program is built around local control of groundwater supply, allowing regions to design groundwater control systems that work best for their own communities. However, as implementation of SGMA has continued to unfold, many have raised concerns that small and disadvantaged farmers have not been adequately represented throughout the process.

Some of the key burdens SGMA places on small and disadvantaged farmers are related to the process of water rights, adjudication and groundwater basins where rights are disputed. These adjudications take place in non specialized courts and can be lengthy, expensive and opaque, all factors which exacerbate the existing resource disparities and underrepresentation of small farmers and disadvantaged communities.

Small and socially disadvantaged farmers can lack the time and resources to sit in on proceedings, track down court documents to stay updated on the process, and can often find difficulty affording the legal cost to stay apprise and fight for their water rights. In 2015, AB 1390 was passed to help streamline the adjudication process and align the process with the goals of Sigma. However, stakeholders have raised several concerns around the uses of the process and areas for improvement.

For instance, some community Members worry that bad faith actors resort to the adjudication process to extend the time in which they can pump groundwater without restriction. This past fall, our office and students from UCLA Law put together a research project along with a series of stakeholder interviews, and identified several areas of possible improvements to the adjudication process that promote transparency, that promotes transparency, equity, and should benefit all parties involved. These suggestions came together in AB 779, the Bill before you today.

We have also convened stakeholder meetings and met with the opposition several times over the last few months and did significant amendments to reflect those conversations. These amendments have addressed several concerns raised to us, and while there is still one last item remaining, we are confident we will iron out the remaining concern.

Additionally, many of the amendments were meant to address the concern raised by judicial counsel, and while we were notified recently of additional concerns over separation of powers, we do understand that the last set of amendments have removed their opposition. We continue to look forward to working with all of the organizations and just want to emphasize the appreciation for their feedback over the lifetime of this Bill.

I'd also like to thank everyone for their research, the work, and the feedback we've received on this legislation and look forward to continuing working with you all in the coming weeks. Now I would like to introduce our witness, Dave Runsten from the Community Alliance with Family Farmers.

Thank you, sir. Chair Members. Dave Runsten for Community Alliance with Family Farmers or CAFF. We've represented small family farms for 45 years in California. Who does poorly in an Adjudication? The historians tell us it's the small farms, rural residents, and the environment. AB 779 tries to address some of this unfairness. It's unfortunate that SMGA didn't eliminate the adjudication option because people are using it to try to circumvent SMGA and the Groundwater Sustainability Agency process.

In Cuyama, two large farming operations, growing carrots and now owned by hedge funds, filed for adjudication because they didn't like the way the GSA process was going. And they petitioned the court to suspend the pumping reductions that the GSA and the GSP had set. They're trying to continue to drain the aquifer as long as they can. The judge said all the small pumpers needed to be represented in court.

And a recent article in the Santa Barbara Independent found that the smaller farms and rural residents are spending hundreds of thousands of dollars on attorney fees. Residents say some of their neighbors are selling their trucks to pay lawyers' fees. Others are taking second jobs or postponing their retirement. In Indian Wells, a large pistachio farm that had been plunked down in the desert filed for adjudication, also unhappy with the GSA and its proposed fees.

The GSA there tells us that there are 800 rural residents and small farmers not represented in court, and it's unclear what will happen to them. The reality is that small farmers and rural residents cannot afford a lengthy court process. Ideally, the court would appoint class counsel for them. And we have provided $1 million via DWR to the UC Davis Law School to set up a legal clinic to seek to intervene in this process.

But we need to do everything we can to make adjudication line up with SGMA and the GSPs and try to discourage these end runs around the community process to keep adjudication from taking over every groundwater basin. We strongly support AB 779, and we urge your aye vote. Thank you.

Thank you. Other witnesses in support, please approach the microphone.

Thank you. Good morning. Phillip Peters, Kern County Supervisor, acting as Vice Chair of the Indian Wells Valley Groundwater Authority in support of AB 779.

Thank you, Supervisor. Others in the hearing room in support of AB 779. Seeing no one approaching the microphone, let's turn to the opposition. If you're opposed AB 779, please approach the microphone.

Good morning, Mr. Chairman. My name is Bob Reeb with Reeb Government Relations, and I'm appearing on behalf of the Valley AG Water Coalition today. Let me first tell the Chair with the chair and the Members that the author and her staff have been extremely accommodating with their time this year and working with us. We appreciate the amendments that the author has taken on her ownvin response to our concerns.

I'd just like to highlight two remaining issues that we're going to hope to continue to work with and close out. The first is the timing of a referral to the State Water Resources Control Board. Right now, under existing law in the Water Code, parties can request submission of a proposed judgment by the court or a stipulated judgment that the parties have agreed to to the Department of Water Resources and for the Department of Water Resources.

The judiciary retains mandamus authority to compel, if necessary, a timely performance pursuant to the adjudication streamlining law, which the analysis in your committee indicates. So we're going to have now two separate laws. One that says the parties can request the Department of Water Resources to submit its opinion, if you will, and this Bill that says that they can go to the State Water Resources Control Board for similar performance of responsibility.

We think there needs to be some consolidation of that and perhaps change the party to which would be requested from the Executive branch. So it's a concern about delay. It's a concern about the consideration for small water users, disadvantaged communities, that we don't get into unnecessary delay and that we don't tip the scales for one versus the other.

Thank you, sir. You could wrap it up.

Let me just wrap it up in final sentence. So the purpose of adjudication is to determine who has the right to extract water and how much. Essentially, SGMA has a different purpose, and that is to determine management.

All right, thank you. Others who are in opposition to AB 779.

Good morning. Lisa Rodriguez with the Gualco Group on behalf of the California Associations of Wine Grape Growers in opposition.

Thank you.

Morning, Mr. Chairman, Senators. Carlos Gutierrez on behalf of the California Fresh Fruit Association, American Pistachio Growers and a variety of other agricultural commodities, opposed unless amended position.

Thank you.

Dennis Albiani with California Advocates on behalf of the California Seed Association, the California Grain and Feed Association opposed unless amended as well. Thank you.

Thank you very much. All right, seeing no one else approaching the microphone, let's turn to the phone lines. Moderator please open the phone lines on 779. For those who are in support and in opposition, so they can provide their name, their affiliation, and their position.

Thank you. To speak in support or opposition, please press one, then zero on your telephone keypad. An AT&T specialist will provide you with your line number by which you'll be identified when called upon to speak, we'll first go to line number 32. Go ahead.

Good morning, this is Gail Delihant with Western Growers, and I'm calling on behalf of the California Chamber as well. Apologize we could not be in committee this morning. However, we do appreciate the author's willingness to accept amendments.

All right. Are you in support or opposed?

And we were opposed unless amended... [inaudible].

All righty, thank you very much.

We will remove our opposition.

All right, thank you. All right, next caller, please.

Line 93. Line 93, your line is open. Line 93, your line is open. Please go ahead. We'll move on to line number 76.

Good morning, Mr. Chairman and Members. Roger Dickinson on behalf of CivicWell, formerly the Local Government Commission in support thanks very much.

Thank you.

Mr. Chairman, we have no further lines in queue.

All right, bring it back to committee. Questions by Senator Laird.

I have a comment, and that is we heard this in the Natural Resources Committee, and there were concerns expressed, and the amendments have significantly addressed them. And also, I want to note, since Senator Grove is not on this committee, that the supervisor that testified was deemed her favorite county supervisor in that hearing, but unfortunately, he did not move her as far as the rest of us really would have liked.

And I think that the comment is that the witness brought up the Cuayama Valley, and I brought that up at the hearing, and I am complimented that he has now encouraged it in his talking points. That is in my district, but we share it. There's four counties that come together in one, and there are two carrot growers that use 70% of that water in that stress basin.

And there are these small farmers that use anywhere from one to ten acre feet a year who conserve, and the others don't. And yet, under the adjudication process, they get credit for overusing the 70%, while the small farmers that conserve are penalized and have to take a share of cuts. This Bill basically gives them a voice so that they are not run over in the process, and they have a chance to carry that interest.

And so this Bill passed the Natural Resources Committee seven to three, and at the appropriate time, I will be happy to make a motion.

All righty, thank you. Other comments or questions, Senator Niello?

Thank you. Thank you, Mr. Chair. So water is complicated. Maybe the most complicated public policy issue that California deals with. Some time ago, there was an adjudication process established in reaction to the establishment of SGMA. And I don't think there have really been any completed adjudications as a result of that. But there are a few that are pending right now. So we really don't know how that process works. We could say, well, it's taking too long, but that's what water issues do.

Involving DWR arguably will make that lengthy process perhaps even worse. But why not let those play out to see how they work before we start changing things again?

As I look at it, and you're right, there are very few that since we put that into law, there are very few adjudication process started until we have the few. But I think this addresses the need that there could be more right as it relates to these farmers being aware of the process and then even within those ones, it will allow this Bill to weigh into that.

So I think that it's necessary in that regard to be able to have this into place to ensure in the future we're taking care of those small farmers, those disadvantaged farmers, and even within the current process this would be allowed to be weighed in. This speaks to that.

I could tell by your nodding when I asked the question. You obviously took that into account as you were crafting Bill, I appreciate that, don't necessarily agree, but I would make one observation. Sacramento County does not have any adjudication processes going on and probably won't. And the reason why is Sacramento County established voluntarily groundwater management organizations as a result of the water form process of quite a few years ago.

And that may be the best way to try to enjoy this, not try to improve the process, not to mandate them, but to encourage groundwater management systems. Could be a much better collaborative approach, right?

And I love when people do things voluntarily. I mean, that's a good thing. And we'd have a better state if more people did things voluntarily versus us have to do it via statute because we are a very diverse state and a lot of times when we create laws, it's a one size fits all approach versus not being able to be very specific to each region.

And so I agree within that point that I would love that but recognizing that there are areas that don't do it voluntarily and we do have small farmers and we were talking about it in Natural Resources that Member of the committee has a quote unquote small farm or considered a small farmer. But we do have to take into consideration that there are those who are disadvantaged by the process and they don't have voluntary people who are voluntary doing the work and allowing for a collaborative environment.

So we do have to weigh in at times at the state level. As much as I love local control and love people, like I said, volunteering to do the work and work collaboratively without having to be weighed in by the government. At times, we do have to weigh in. And I appreciate it because we know water is gold. And I wish water was as simple as it is when we talk about gold, but it's not.

And so we do have to deal with that as a state and be able to weigh in accordingly to ensure that everybody is taken care of. And that even when it comes to water, that we look at it from a viewpoint of equity.

Whiskey is for drinking, water is for fighting over. And by the way, I wasn't able to make it to the reception, but I was wearing pink yesterday.

Thank you so much. I appreciate that.

All right, thank you. Senator Niello, I'm grateful that you've provided the quote to start the day because I know we're going to hear it more than once. All right, other questions or comments? Senator Laird will move the Bill as soon as we have a quorum. For those of you who are listening, if we have one more Member who appears here in Room 2100, we will have a quorum. So I would encourage staff members to encourage their Member to appear here, even if it's only momentarily. All right. Would you like to close?

I would. Thank you, mr. Chair. I would just like to note from opposition that we definitely have been having lots of conversations over the life of this Bill. And I've appreciated bringing the concerns because, as always, through our legislative process, you try to mitigate unintended consequences of your Bill. There were two items noted from our primary opposition in regard to delays and noting that part of this Bill says the judge may refer matters to the waterboard. This was a suggestion that we took from Judicial Counsel.

It won't cause delays because it's during the fact finding process and not near the end of the process. And in regard to the other part, the other noted concern is the water use of small farmers and disadvantaged communities have been considered that language. In particular, it makes it seem like from the opposition's point of view that it unfairly elevates those communities. And that was not the intention.

We wanted to make sure that it was clarified that all the other items, one through three in the Section 850 A, are just as equal consideration of small farmers and disadvantaged communities. And that is the language that has been amended which will help address those final concerns of the opposition that we agree to address.

And so with that, at the appropriate time, I appreciate Senator Laird future motion, but I would appreciate an aye vote because this is really important and it does improve this process on behalf of our small farmers and helps ensure that we are not displacing these important community members.

All right, thank you. I'm going to announce a few other housekeeping items, then we're going to turn to your next Bill. So after Assembly Member Wilson presents item number 2, 868, then we're going to allow Assemblymember Holden oh, I'm sorry. As well as AB 1472. Then Assembly Member Holden. Item number three, AB 647. As those of you are listening heard, AB 1228 is not going to be heard today. Then we'll turn to Assembly Member Addis for item number five this afternoon.

We're going to break at noon for the respective caucuses. There'll be a special order at 130 this afternoon. And so first, then we'll begin with Assembly Member Maienschein his bills and Judiciary's bills at 1:30. All right, next, in order, item number two, AB 868.

Thank you. So AB 868. This is the Digital Advertisement Transparency Accountability Act. This would create a centralized, searchable and user friendly public record of digital campaign advertisement that appear across multiple online platforms associated with a campaign or an election. This Bill would require all digital ads paid for campaign committees and specified information about these ads to be submitted to Fair Political Practice Commission, also known as FPPC, campaign committees must be responsible for the content they produce for public consumption.

Let me first explain what exists now. AB 2188, signed into law in 2018, makes online platforms responsible for submitting certain digital ads that appear on their platforms. AB 868 maintains that responsibility as status quo, with an adjustment to transfer the data to the FPPC versus their own online database. Once enacted, AB 868 would have campaign committees responsible for submitting all other digital ads.

Committees be required to submit their ads only if they spend $1000 or more on digital ads during a campaign statement reporting period, and the information would be due along the same deadlines as campaign statements. This easily accessed public resource would provide voters with more information about campaign activity, including the messaging used by campaigns and the amount and sources of money spent on ads in support or opposition of various campaigns.

It will also provide greater transparency in our ongoing fight to reduce misinformation disinformation in the political discourse. Now, my office has worked closely with not only Senate Election Committee staff, but with California Clean Money Campaign and the FPPC to attempt to come up with the best version of this Bill possible. I also understand this has brought on concern from the platforms. However, as we make our way through the legislative process, we will continue to discussion to alleviate this concern.

As I noted at the beginning of our remarks, and have maintained from the moment I introduced this Bill, it is my firm belief that campaign committees should shoulder the ultimate responsibility liability for the content they produce. With me today to discuss this further is Lindsey Nakano from Fair Political Practices Commission.

Thank you very much.

Good morning, Mr. Chair and committee. My name is Lindsey Nakano. I'm with the FPPC. The Fair Political Practices Commission. The full Commission has not had a chance to review the most recent amendments to AB 868. But I have a statement from the chair of the commission, Richard C. Miadich, that was also cosigned by FPPC Commissioner Abby Wood. On behalf of the California Fair Political Practices Commission, we want to thank Assembly Member Wilson for her stewardship of AB 868.

Which would enact the Digital Advertisement transparency and Accountability Act. The Bill is based on the recommendations made by the FPPC's Digital Transparency Task Force, which brought together academics, representatives of good government groups, campaign professionals, and regulators who sought to identify ways to improve transparency of digital political ads.

We believe AB 868 would unquestionably improve voters ability to know who is behind the many forms of digital political ads that have become so ubiquitous in our lives, and to hold those persons or groups accountable for the content of those advertisements. Earlier this year, the FPPC voted to support and sponsor AB Eight Six Eight as introduced.

We believe the recent amendments to AB 868 are fully consistent both with the recommendations by the FPPC's Digital Transparency Task Force, as well as the Commission's goals in supporting and sponsoring AB 868. In fact, we believe the amendments will improve upon the task force's recommendations and further strengthen the transparency of spending on digital political advertising.

We therefore wholeheartedly support AB 868, as amended, and look forward to recommending that our colleagues at the next Commission meeting in August vote to continue supporting this important legislation. Thank you. And I respectfully ask for your aye vote.

Thank you very much. Before we take other support witnesses, we're going to establish the ever elusive quorum. Madam Secretary, please call the role for establishing quorum.

Umberg here. Umberg here. Wilk. Present. Wilk. Present. Allen. Ashby. Caballero. Durazo. Laird. Laird here. Min. Min here. Niello. Niello. Here. Stern. Stern. Here. Wiener. You have a quorum.

We have a quorum. Just to note that we have the full complement of Republicans, and we're lacking some Democrats here in the committee hearing room. All right. Further witnesses in support of AB 868. Seeing no one approaches the microphone, let's turn to opposition. Opposition to AB 868. Please approach the microphone.

Instead, this Bill would require the reporting to be done by the online platforms that are hosting that third party content. Those who prefer moving the reporting responsibility over to online platforms have pointed to the hardship that smaller or less politically sophisticated committees may face in submitting their reports. If a committee has developed an ad, placed the ad, and funded the ad, we believe they are also capable of reporting on those ads. Furthermore, this shouldn't be about alleviating a burden by shifting it to another entity.

It should be about the public good, the value of knowing that those engaging in political speech online are being properly held accountable for it. If a committee is unwilling to do so, that in itself raises significant concerns. In addition, platforms vary in their processes for approving and placing ads on their sites, and this process is not always entirely automatic or streamlined, especially for smaller platforms. Placing the reporting burden on platforms only creates additional friction to that process.

Again, in order to enhance transparency and promote ethical behavior, we believe the reporting should rightly come from the committees themselves, who are being monitored for engaging in potentially questionable practices. If this requirement was shifted back over to those committees, TechNet would remove our opposition. We very much appreciate the recent conversation with your office on our concern, and we look forward to continuing those moving forward. Thank you.

Thank you very much. Others in opposition saying no one approaches the microphone. Let's turn to the phone lines. Moderator, please queue up those who are in support and opposition, AB 868.

To speak in support or opposition, press one, then zero. At this time, we'll first go to line 62.

Yes, good morning. My name is Jacquolyn Duerr, I'm a public health advocate live in Sacramento, and I strongly support this Bill.

Thank you. Line 14.

Hello. My name is Mary Bevins and I live in San Mateo and I strongly support AB 868.

Thank you. Line 47.

Hi. Trent Lange, California Clean Money campaign in strong support.

Thank you. Line 35

[Indiscernible] in strong support.

Ron Zucker, a Clean Money volunteer from Petaluma, in support of AB 868.

Thank you. Line 60.

Line 25.

Nancy Neff from Palo Alto in support.

Line 88.

Shirley Shelangoski from Pleasant Hill, Contra Costa Move On, in support.

Thank you. Line 106

David Schmidt from San Francisco, in strong support.

Thank you. Line 93,

Jeff Tartagia, Sacramento advocate, in support.

Thank you. Line 57.

Suzanne Lander, Sacramento. Strong support.

Thank you. Line 87.

Ben Golombek with the California Chamber of Commerce in opposition.

Thank you. Line 34.

James Pearson, Gilroy. Strong support.

Thank you. Line 31.

Howard Mavis from Oakland. Strong support.

Thank you. Line 39

Betsy Guthrie, Indivisible Marin. Strong support.

Thank you. Line 51.

Pat Lang, Los Altos Hills. Strong support.

Line 13

Is this me?

Yes, sir, go ahead.

Michael Levinson Daly City. Also with Clean Money, strong support.

Mr. Chair, there are no further lines in queue.

All right, thank you. Let's bring it back to committee questions by committee Members. Senator Stern.

Thank you, Mr. Chair. I want to thank you for the legislation and trying to get a hold on the Wild West out there. There's a lot happening and it's moving faster than often we can track and things appear and disappear and reappear. And there's a lot of risk right now in the system around electoral security because of the amount of misinformation that's being pushed and frankly, because the platforms themselves, on the not paid side at least, they argue, have their hands tied.

And so you see content that's in the not paid space, in campaigns be wild and unruly as it is, at least in this space where we have some rules, we got to just make sure that the regulators have tools to enforce the rules. That's how I look at your legislation. I want to get your take on. I know Common Cause had a position that they didn't want the political committees to sort of feel that burden.

Now it sounds like the opposition is concerned that the platforms are going to feel too much burden. How are you resolved.. like, in the most recent amendments, I guess, have you brought, is Common Cause now supportive of the current framework? The analysis says that they wanted more responsibility, at least on the platforms that received the ad payments, but then, hearing the tech industry say that that already is the case. So can you just help clarify?

Absolutely. So the current status quo, the current law says that the tech companies and six in particular, kind of like the Big Six, are responsible for reporting, their, well, I shouldn't say reporting, but collecting and holding in a database the digital ads that they receive revenue from. So that is the current status quo,know where we exist right now in the state of California.

So my Bill originally introduced, transferred the whole of the responsibility to the committees or campaigns because, like I noted, firmly believe that they're ultimately responsible for the information they put out in the world. And they're producing it. Right? They're creating it. And so through compromise, through the election, through this process, as we continually in my office, we always work with opponents to figure out, okay, what the issue is. Is it a real issue? Is it valid? Okay, how do we then mitigate that?

There was concern that they had fought hard for that original transparency by having the Big Six do that and that there would this be undue burden on smaller campaign and committees. Now, I had an issue with that because they're producing it, right? But I also recognize that this is the first time that we're having committees or campaigns produce any content. We usually just have them put their revenue and expenses, that's all.

We just have them report on their transactions, but we don't actually have them turn in anything that they're producing. So the fact that this is the first time I was like, okay. And then at the end result is for a constituent or those who are holding people accountable, the end result is full transparency because it's now on FPPC, I can say Lori Wilson, what did she produce during this period at the time that she spent the money? Not on some online database somewhere else.

I can go right there and see the ads that she produced, not in real time, but in reporting time, right. And be able to tell whether she's putting out misinformation or saying one thing to one person or whatever and holding her accountable as a voter, right? And so it allows that. So for me, I consider it a win for our constituents and those who hold accountable.

And I also recognize that part of the legislative process is compromise and working through and giving times for thing to bake. We were just talking about the adjudication process and how giving time for something to bake. And so this gives it time for committees to start the practice of submitting, doing something that they've never had to do, and then at the same time keeping the status quo in the law.

And then I'll be honest, for me as an author, I want the full burden on the committee. But through this process, sometimes you compromise. And as long as the end goal is the same, which the end goal is, our constituents, our people who are holding people accountable, they get full transparency. And so hopefully, you'll probably see me back with some legislation that fully transfers that burden.

Because I do think at the end of the day, my core belief is if you produce the content, you are responsible for the content and you are in the best position to be able to report that content, just like we have no one else report your finances.

Ms. Chair, if you don't mind, what I read from how the Bill at least operates right now, according to analysis, is that there will be likely at the point of transaction between that platform and the campaign when that ad is uploaded and sent and submitted, depending on what they're saying, there are multiple vetting protocols, but at that point of transaction, my assumption is someone will come up with a button that will be one of the things you check.

And at the same exact moment that they're asking to put this ad out into the universe, they're also going to be consenting to a transfer of some sort?

Well, they currently already do because remember, it currently exists. It's now just on an online the only change in law for a tech online platform is instead of holding it in their own database, they're sending it to FTC. And so they would have to do that compliant with law. So yes, so it would just be automatic associated with that

Some sort of built in consent to that transfer. It's not going to necessarily need a whole clunky extra step. So even for the campaigns themselves, who we want to push ourselves and everyone else to own what they put out into the world, they'll be doing that. It'll make it crystal clear you're putting your money down and you're saying also people are going to know at the FPPC that I put this out there.

And people more than who you're targeting, because that's the issue with the digital ads, is that it's about targeting. Like, I want women over 50 who own cats and now women under 40 who don't own cats are going to be able to see that ad if they want to.

Right. Will they know any of that information, too?

They know who was targeted, yes. That's part of what they have to report is who was targeted. So when I go buy an ad as a campaign, I tell them, most of your ads, to be honest, are and most of your ads on good actors are really broad. Right. All voters over 18 who live in my district, that kind of thing.

But we see especially with misinformation and disinformation, we see this micro targeting to specific people, and then we see the exact opposite information micro targeted to somebody else. And so that part of it. That's not the whole part of it. The whole part of it is transparency, but part of it is to stop those kind of things happening, because that's how we get this feed into our political divide is people are feeding into misinformation, disinformation to the general public.

And the last thing I'd say is the FPPC now is taking on a new responsibility in a way. And so I'm just curious, from their perspective, I know they haven't voted on the amended version, but are they ready to take on, I mean, that statement evaluation part of things? I don't know if the counsel is still here, but I was curious just.

To and just so you know, this came from FPPC. So this is part of their process that they did the audit and then they said and so this actually in some ways is a little less burdensome for them than the original Bill, because still we have this burden on the online platforms. And of course, the way they aggregate and push data is very different than a campaign doing it. So it actually is a little less simplifies the process.

It'll put it in a nice package for them. I'll be supportive of the Bill today. I'm hoping that we can get just some input about the administration side and to know what that evaluation process is going to look like in reality, because I think we're probably going to have to look to fund some, this is personnel. This is going to take time. Anyway, I'm glad you're committing us to this. I really appreciate your leadership here.

And I'm happy to make the motion.

Thank you.

All right. Senator Stearns moved the Bill. Questions, comments? Senator Niello?

Thank you, Mr. Chair. Targeting demographically and psychographically in the effort to promote anything is not at all new. It's happened about as long as advertising has happened and has become more sophisticated as media outlets have evolved. Direct mail you can target on a more broad basis, but nonetheless you can target. You can send one mailer to Republicans that talks about A, B and C factually and correctly.

And you can target Democrats separately that talk about D, E, and F factually and separately. Now, is that misinformation disinformation? It depends on the ear of the beholder, right? TV. Excuse me, radio. You can also target to conservative, more liberal shows. Cable TV has offered advertisers the ability to even more closely target. And so there's nothing new here. Why don't you include direct mail? TV, radio, et cetera.

So in particularly, direct mail, you actually have a physical evidence of that and it's a lot more expensive. And the same thing with TV, not so much with radio. Radio is still an inexpensive medium. You can record it on your own. Right? You can record a TV. You can record because most of us have DVR. It used to be called DVR. Yes. An individual can, a constituent can there are ways to capture that data.

And so we kept it to digital because it is so hard to capture digital ads. They come up very quickly. You see it and it takes a few steps to do either a screen capture or anything like that. And so we started there in the sense, one, that was a recommendation, but two, I affirmed that because digital ads are just so hard to capture and they're really cheap. They're very inexpensive to produce.

If you think about if you can spend $1,000, you can target a lot of different people in a lot of different ways. And so part of it is because the inexpensiveness to how cheap it is to do digital ads and as well as how they don't exist for that time. If you think about it, it's usually three to 5 seconds for an impression. It's not that much. And then it goes and you get it repeatedly.

You know how to capture it, but for the most part it's gone. And so you can't do that comparison like you could if you got a mail. There's so many households that people are registered differently just to see the type of mail they get. And I think that it's okay to target an audience. Right. And you do want I mean, we all feel better when we get an ad that we care about, but at the same time, we don't want people just wholly lying. Right.

Which misinformation and disinformation is about deceit, not recognizing the multifacet of a campaign or committee to be able to communicate in many different ways to many different people. Because at the end of the day, you're representing all those people. So that's okay. But it is not okay to disinform or misinform. And people tend to use digital media to be able to do that because it is as inexpensive. And there's no evidence that you did that in which we saw definitely in the 2016 campaign.

Thank you. One second before I'm going to have to leave, okay. I'm going to turn over the chairmanship to Senator Laird. There's only 32 bills left. So, Senator Laird, my expectation is you probably won't be finished by the time I return, but thank you very much. Okay. All right.

Just one last comment. Specifically, with regard to misinformation and disinformation, you mentioned the 2016 campaign. Going back well, when I was here before, misinformation disinformation was not terms that I commonly heard. We do now. It has become prevalent since 2016 and particularly since the pandemic.

Yes.

And what's chilling about this is who's going to define what misinformation and disinformation is, not expecting an answer, this is really a comment because as time has gone by, what some people have felt were statements of misinformation or disinformation subsequently have been proven not to be quite so. So he or she who defines what misinformation or disinformation at a particular time may or may not be correct. And that can contaminate this whole approach.

And I agree with you. And I will note that this particular Bill does not put that burden on FPPC. It just makes the information available. So it's up for the individual person who is voting for that campaign or committee or candidate to decide based on the information received whether they feel like that they should continue to vote for that person. And so we intentionally did not put it and that there was a flagging of or anything like that.

All it is is creating transparency so that someone can see all of the things that somebody puts out or a campaign and determine if they still want to vote for that person. Like everybody left. You're still here. I'm so sorry. I'm so sorry. No disrespect. Lovely. Three Senators here.

Does that complete your comments? Are there any further comments or questions seeing none, we have a motion, so you may close.

I respectfully ask where aye vote. I thank Lindsey from FPPC, as well as the great discussion here.

Thank you very much. Then we're going to ask for call of the roll.

This is file item number two, AB 868. The motion is due passed to the Senate Appropriations Committee. Umberg. Wilk. Allen. Ashby.

Thank you. We'll put that bill on call. And before, you're going to nominally present the vote-only bill, but the thing about it is that it doesn't require presentation. So I think you're just going to stand there. And I was going to do a catch-up on your first bill and the consent, but I'll do that after we do this so that you don't have to stay for the rest of it.

Sounds good.

Let me ask, do we need a motion on this? Is there a motion? Okay, this is a motion on item seven. It's vote only. We're done with the hearing, so let me ask for a call of the role.

This is file item number seven. AB 1472. The motion is do pass to the Senate Appropriations Committee. Umberg. Wilk. Allen. Ashby. Caballero. Durazo. Laird. No. Laird, no. Min. No. Min, no. Niello. No. Niello, no. Stern. Wiener. Zero to three.

Thank you. We'll put that on call, and then before we move to Assemblymember Holden, item three. Let's catch up.

Senator Laird, can I ask for a quick clarification?

Yes.

So, Assemblymember Alvarez wanted a reconsideration on his bill. Should I come back later when the close for that, or should I request that?

Does she have to come back or can we note it? Then we will just note it at the time of any action.

Okay, thank you.

Thank you very much and appreciate. Then let's go back. Do I have a motion? Hello? Hello? Earth to you. Do I have a motion on AB 779? Moved by Senator Min. Let's call the roll.

This is file item number one, AB 779. The motion is do pass to Senate Appropriations. Umberg. Wilk. Allen. Aye. Allen, aye. Ashby. Caballero. Durazo. Laird. Aye. Laird, aye. Min. Aye. Min, aye. Niello. No. Niello, no. Stern. Wiener. Three to one.

Three to one. We'll put that bill on call. And then do I have a motion on the consent agenda? Motion by Allen. Would you please call the roll? Thank you, Senator Niello, for the consent agenda.

On the consent calendar, Umberg. Wilk. Allen. Aye. Allen, aye. Ashby. Caballero. Durazo. Laird. Aye. Laird, aye. Min. Aye. Min, aye. Niello. Aye. Niello, aye. Stern. Aye. Stern, aye. Wiener. Five to zero.

We have five votes. We'll put that bill on call. Now, thank you very much for your patience, Assemblymember Holden. We are going to move to item number three, Assembly Bill 647. And the floor is yours.

Thank you, Mr. Chair and members of the committee, for allowing me to present Assembly Bill 647, the Grocery Worker Retention or Protection Act. I would like to begin by accepting the committee amendments. And despite their essential service, grocery store workers have become collateral damage in the wake of recent mega grocery store chain mergers. AB 647 seeks to prevent this by strengthening and expanding statewide grocery worker retention and rehiring laws. As amended, this bill will expand grocery worker retention law to include warehouse employees.

Remove the incentive to prolong a grocery store from reopening to avoid post-merger retention procedures expanding the window from six months to 18 months or more. Provide enforcement provisions that allow for the labor commissioner to enforce and grant a private right of action for aggrieved employees. I've heard from the concerns raised by the opposition, and I would like to take a moment to address them.

Let me first begin by saying that several amendments were taken at the opposition's request as the bill came out of the Assembly Appropriations Committee as an effort to address their concerns in good faith. These amendments include a 300 employee minimum threshold, clarification of the definition of front and back pay, and removal of the joint and several liability section as it relates to a controlling, private fund. In addition, it reverted to existing law with regard to the 90 day retention period.

With that said, I would like to state that my office is always prepared to continue negotiations in good faith. Here with me to testify in support of AB 647 is Mariko Yoshihara with UFCW, and Robert Lanius, an employee at Gelson's. In closing, AB 647 will protect workers by preventing mass layoffs and ensuring a consistency in food safety and pharmaceutical knowledge within our communities. I respectfully ask for your aye vote.

Thank you very much. And under our rules, we have two minutes each for the primary support witnesses. So welcome to the committee. You have two minutes.

Thank you so much. Good morning. My name is Robert Lanius. I'm a meat manager and seafood manager at Gelson's in San Diego and a proud army veteran. I used to work at Vons, Safeway, as we know, until my store got shut down in the ugly Safeway Albertson merger.

That is why I'm here today, because I've seen firsthand just how mergers work and hurt families and employees. I am a sole provider for my family. This job isn't a sidekick or a hobby. It's my livelihood. Like so many others, we rely on this job to give us what we need to survive, from income, to health insurance, to retirement. We have rent, mortgage, utilities, insurances, and other monthly bills to pay. We have mouths to feed. And without these jobs, we have nothing.

We know what happens when two companies merge. Stores close. So it is imperative to act before these powerful companies merge. Powerful impacts of a merger are hours get cut, workers are shuffled from store to store, losing income and losing their seniority. Some taking massive pay cuts and some having to commute hours to work and long distance, taking away from time from their families. And communities we serve lose access to fresh foods, healthy, and prepared meals, which is vital to our senior communities.

So when we hear about a merger on the horizon, we fear the worst. What I'm feeling today is anxiety. I am a 55 year old man with two years away from retirement. This merger will destroy everything that I've worked so hard for me and my family to build. Those of us who were lucky to survive the last grocery merger in 2014 saw how it destroyed countless lives, livelihoods, in the blink of an aye. And many of these workers today never recovered and are on permanent disability. And we fear...

I'm sorry to interrupt. Could you please wrap up over here? Could you please wrap up? You've exceeded your two minutes.

Yes. So, yes, I am fearful the future holds for workers like me. But I'm also hopeful that our senators will support this bill and ensure that the future we look forward to is an opportunity. I thank you here today, and I hope you'll fully understand the powerful bill that's what would be impactfully, that you can help our communities and lives without fear. Thank you so much, guys.

Thanks. And I assume you're in support of the bill? No, you just didn't say that. That's all I'm doing. If we could have the other primary witness for up to two minutes. Thank you very much. We appreciate your comments.

Mr. Chair, members. Mariko Yoshihara here today on behalf of UFCW Western States Council in strong support of AB 647. This bill is a modest expansion of our existing grocery worker retention law that was passed back in 2015. It's critically important that we pass these additional protections and strengthen the law now while we're facing one of the largest proposed mergers in the grocery industry history. The Kroger Albertson's merger threatens to substantially reduce the workforce in these two grocery chains through mass layoffs.

The companies have said that they may have to divest up to 650 stores nationwide in order to secure antitrust approval from the FTC. And if there's not enough competition, the FTC will mandate that a specific number of stores will have to be divested off or closed down. In just Los Angeles and Orange County alone, it is estimated that close to 6000 workers may lose their jobs due to this merger.

So this bill will simply ensure that these workers who are laid off can stay on a preferential hiring list and keep their jobs in their communities. And just to be clear, this only applies to workers who are laid off due to nondisciplinary reasons. There is a rebuttable presumption that a worker who's terminated within a year of a change of control is due to nondisciplinary reasons. But that's all it is.

It's a presumption that is rebuttable, which means that if a worker is fired for cause, the employer has that for cause termination to rebut the evidence, to rebut the presumption. And therefore, this bill would not apply. Again, this is a very narrowly tailored bill to address these mega mergers. If we want to avoid these mass layoffs of our skilled and trained grocery and pharmacy workers, it is imperative that we pass this bill. So on behalf of UCW, we strongly urge your aye vote on AB 647. Thank you.

Thank you very much. We appreciate your comments. This would be the opportunity for anybody in the hearing room to do a me too in support of this bill, which is just name organization and the fact that you support the bill. Welcome.

Good morning. Nick Cruz with the California Labor Federation in support.

Thank you very much.

Thank you, Mr. Chairman. Matt Cremens on behalf of the California Nevada Conference of Operating Engineers in support.

Thank you.

Good morning. Samantha Gordon with TechEquity Collaborative, in strong support. Thank you.

Thank you very much.

Good morning, senators. Forrest Cameron on behalf of the Western Center on Law and Poverty, here in support. Thank you.

Thank you very much. Seeing no one else in the room, this would be the opportunity for anybody to testify against this bill. And I don't know are you a primary witness?

Yes, sir.

Then welcome to the podium and you have two minutes.

Mr. Chair, members of the committee, Louie Brown here today on behalf of the California Grocers Association in opposition to the bill. We do appreciate the conversations we've had with Assemblymember Holden, but we do remain in opposition. First, the analysis focuses on the merger that's in the news. This bill will do nothing to impact that merger. That merger is going to be guided and officiated by the Federal Trade Commission and the outcome of that will be directed at a federal level.

The supporters of the bill also talk about how this will be used as deterrence for future mega mergers. The changes in this bill will impact almost every transaction in the grocery industry going forward, notwithstanding the amendments that talk about it only impacts those grocery companies with 300 employees or more. Most grocery companies have 300 employees or more. Even the smallest independent grocer in the state of California with two or more stores will have 300 employees or more.

So every future transaction will have to abide by these changes to the rule. And one would ask, why broke, or why fix it if it's not broke? We've seen this work in the past, since 2015. We've seen transactions continue to occur. We've seen employees protected with those instances that are in the law currently. But now we're going to add a private right of action to the bill. So those transactions are now going to be extremely scrutinized.

And I think actually what we see is going to be the exact fear of the supporters actually become reality. Now those transactions are going to look and people are going to have a second thought if they're going to go and look at the opportunity of procuring another grocery store. There's a lot of commercial space that grocers can take. And if they're looking at analyzing the issues and the penalties and the liabilities that come with the changes in this bill versus just procuring an open space and expanding a business.

Excuse me if I can ask, is there a second primary witness in opposition? If there's not, then I'll let you finish your statement and use extra time.

I believe I will be the only one today.

Okay, please continue.

As I was saying, if you are in the future looking to make a transaction or a procurement, and you look at the potential liabilities and costs that come with the changes of this bill, including the private right of action, and compare that with the opportunity of just moving into open commercial space, the opportunity of moving in open commercial space and expanding the business becomes much more appealing.

And therefore, I think what we'll see is a greater opportunity for food deserts occur, limited expansion within the grocery industry, and more detrimental impact on grocery workers going forward if this bill were to pass. That's why we're in an opposed position and ask for a no vote. Thank you.

Thank you very much. We appreciate your comments. We'll now move to me too opposition with people in the room, anybody that opposes this bill with name, affiliation, and opposition. Seeing no one step to the microphone. Moderator we will come to the teleconference system, and this is the opportunity for anybody to either state their support or opposition to the bill. And just in me too fashion, just name, organization, and position. Moderator, over to you.

Thank you. As a reminder, if you would like to speak in favor or opposition, please press one, then zero on your telephone keypad. We will go first to line 52. Go ahead.

Hi, can you hear me?

We can hear you just fine.

This is Sarah Pollo Moo with the California Retailers Association. Respectfully opposed.

Thank you very much. Next caller.

Mr. Chairman, we have no further lines in queue.

Thank you very much, Moderator. We'll be back to you in a little while. We will bring the matter back to the committee. Are there questions or comments by committee members? Senator Min.

Yeah. I want to thank the author for bringing this legislation forward. The larger problem that we can't address in this state is the consolidation of grocery chains. And we see that this is almost certainly going to have a huge negative impact on consumers and on workers. Just in my own neighborhood, I know that we'll lose a number of grocery stores, and they're all very packed. The lines are typically very long, and I haven't heard a compelling rationale for why these mergers are helpful or needed. I think we are potentially facing huge impacts on our workforce. I appreciate the testimony of the support witnesses today.

I've talked to workers in my local Albertsons and Pavilions and they're all deeply concerned about their futures and so would like to move the bill at the appropriate time and commend you for bringing this forward.

Thank you very much. Other questions or comments from committee members? Senator Allen.

For Mr. Brown, what is it that your folks are finding most onerous about what's being proposed here?

Through the chair. Mr. Brown, welcome back.

Thank you, Mr. Chairman. Again. Louie Brown on behalf of the California Grocers Association, I think, definitely, Senator Allen, through the chair, the most problematic element of the bill is the private right of action. And that just, we believe, opens up significant scrutiny. There are other issues with for example, now the bill would.

I mean, the privatization isn't a problem if there's not a violation, right?

Well, there are alleged violations that then just take up time and litigation costs and resources. There is a change to the bill, or addition to the bill regarding this 15 miles. We don't know where that came from. And that if a person is transferred more than 15 miles, they can refuse that. This is a large state. 15 miles in Siskiyou County is much different than 15 miles in LA County.

And so we think this one element is just an example of a change that we don't know where it came from, why it matters, and why it has an impact. We've not been consulted on it and not been able to give any feedback on that as well. So those are just a couple of examples we could definitely go through and find others that are problematic to us.

But you've been good about.

But most concerned about PAGA.

Any further questions or comments from Senator Allen?

Maybe if the author has any comments on the 15 miles.

In his close, we'll ask you to address that in your close.

Or now.

Then go ahead. I'm just trying to move us along.

I appreciate it.

Unsuccessfully.

Well, I'll make it a short response. The 15 miles, as I recall, has always been in the bill. We'll have one of our witnesses validate the point, but it could be used if a person is relocated outside of 15 miles, we're looking at it as a reasonable distance to travel. You put someone outside of that range, and then, of course, there's a hardship to get from where they may live close to the store that's just been shut down or merged into a larger operation. So it really is trying to pay respect to the workers and making sure that they're not sent out to destinations well beyond their ability to get to.

Does that complete your questions or comments, Mr. Allen?

I'll let Mariko respond and then I'll stop.

Yeah. So the 15 miles that's always been in the bill, it's actually in a lot of collective bargaining agreements as well. And the premise is we want to keep these workers in their communities. And so when you have these big mergers, oftentimes there will be a transfer that is 30, 40 miles away. And if that worker can actually refuse that transfer but still maintain be on a preferential hiring list so that when a job opens up in their community, they're able to take it.

That's obviously the best scenario. And then just in response, to the private right of action. Like Senator Allen said, this really only is a problem if there is a violation. And it's a very narrow set of circumstances. We're only talking about recall or retention. And PAGA, there's a right to cure if there's any violation under PAGA.

So really it's important that we have some enforcement mechanism because if you end up relying on a labor commissioner, we know that's overburdened, under resource, it takes workers close to 500 days in order to get relief there. So that's why an enforcement mechanism is really important.

Thank you very much. Does that complete your, Senator Min already expressed that. But let me ask her, are there any other questions or comments? Senator Niello.

Just to add on to that point, with regard to a private right of action, no fear if there hasn't been a violation. Well, there can be an allegation that then needs to be proven in court. If it is disproven, that is to say, the plaintiff in that case is judged to be wrong. The defendant not guilty of the private right of action charge. And this bill specifically states that the defendant has no right to collect legal fees, but the plaintiff has a right to collect legal fees, which seems entirely one sided and unfair to me. This is one of a few bills we'll see today with regard to worker rights. And individually, each one can be defensible.

And I'm not here to argue that one way or the other, but I would point out that in each case, it presents a burden on the employer. And burdens on employers don't do a great deal to encourage businesses in the state of California to expand or other businesses to come into the state of California so that in a rather perverse way, this attempt to help workers can actually result in reducing the opportunity for increased jobs because of burdens that businesses don't want to take. It's a tough line to straddle, but I'd suggest that on the whole, we're straddling it on the side of limiting opportunities for job creation in the state of California.

Any other questions or comments? Seeing none. We have a motion by Senator Min. Assemblymember, you may close.

Thank you, Mr. Chair. We're seeing this not just in California, but across the country. And growing up in my community in Pasadena, we had a lot of smaller markets. Then larger markets came in. We had Alpha Beta, we had pantries. You don't hear about them anymore. But then you had larger businesses that would come in and gobble them up.

And we're seeing it grow even more, not just here in California in the merger that's in front of us, but across the country, which is making super mega supermarkets and grocery outlets. And that in and of itself is what this bill is about. Those workers who get caught up in circumstances that are outside of their own and how we can best protect them and make sure that they have an opportunity to have a job on the other side should they choose to stay on. And this bill is designed to create an opportunity for them to be treated fairly in that transition. So I respectfully ask for your vote.

Thank you very much. Would you please call the roll?

This is file item number three, AB 647. The motion is do pass as amended to the Senate Appropriations Committee. Umberg. Wilk. Allen. Allen, aye. Ashby. Caballero. Durazo. Laird. Aye. Laird, aye. Min. Aye. Min, aye. Niello. No. Niello, no. Stern. Aye. Stern, aye. Wiener. Four to one.

We have four to one. We'll put that Bill on call. Thank you very much. I see Assembly Member Bennett. Is there another author here I'm missing just before I do that? Not seeing one. We'll move to item number nine, Assembly Bill 560, by Assembly Member Bennett. Just before I turn it over to you, you're the only author in the room and we still have about 30 bills. So, if there are authors that might want to sneak ahead in line, run now. Assembly Member Bennett, the floor is yours.

I'd like to thank the chair and the committee staff for the hard work they've done on this Bill. AB 560 simply ensures that a judge in a case knows that the Department of Water Resources and State Water Boards have evaluated a proposed settlement for its consistency with a groundwater sustainability plan that has been put in place by local hardworking people. We've recently accepted an amendment from the Judicial Council that removed Judicial Council's review. We think it's an excellent amendment, and we've incorporated 120 day turnaround for the departments that ensures that they will not be dragging out any adjudication. And with that, we have two witnesses to testify and support: Supervisor Philip Peters from Kern County, and Dave Runston from the Community Alliance of Family Farms.

Thank you very much. Supervisor, welcome to the committee. You have two minutes.

Hi, good afternoon. Jeff Simonetti with the Capital Core Group, representing the Indian Wells Valley Groundwater Authority. We are in strong support with Assembly Bill 560. And, the important thing to remember here is that, much like we were talking about with the discussion pertaining to AB 779, the concern that we have and the reason why we are so supportive of this bill is that it's going to make sure that both disadvantaged communities as well as small community farmers are an indispensable party as part of the adjudication process so that they're heard. And I think this is a really important step to make sure that, like 779, there are a fair process that adjudications will go through to make sure that all parties, no matter their representation, are able to be heard. We represent again, the Indian Wells Valley Groundwater Authority, which is one of the 21 critically over-drafted groundwater basins in the state that's going through, has an approved GSP, but is under an adjudication process at the moment as well. And we believe that this is a very important Bill to be able to move that process forward. And we urge your aye vote. Thank you.

Thank you very much. And is your other primary witness here? Is that a yes? Would the other primary witness make their way to the podium. You have up to two minutes.

Chair and Members. Dave Runsten Community Alliance Family Farmers. I won't repeat what I said in my AB 779 testimony, but know that the Kayama and Indian Wells examples are clear cases of the deplorable efforts by large farming operations to circumvent the Sigma process by filing for adjudication mission and ask the court to suspend GSA management actions.

AB 560 attempts to limit this end run by bringing in the Water Board and DWR to review any adjudication settlement and to see whether it would conform with the local groundwater sustainability plan and protect small pumpers and disadvantaged communities. It doesn't require the court to accept these agencies'judgment, but it will provide important information to all parties and to the public at large. This seems essential to us and carries on the intent of the Legislature in passing Sigma.

Not all judges are well versed in Sigma and its details, and they could lose sight of what Sigma seeks to achieve in terms of equity and sustainability. We strongly urge your support for AB 560.

Thank you very much. Those are the two primary witnesses. This would be the opportunity for any Member of the public in the room to do a me too in support of this Bill name, organization and the fact that you support seeing no one, then we will move to opposition. I don't know if there's a primary witness here, then welcome to the committee.

Good morning. Thank you. My name is Elizabeth Esposito. I'm an attorney with Brownstein and I represent Mojave Pistachios, a large Pistachio grower Sierra Shadows Ranch, a small grower, and the Ineochirn Community Services District, a public agency that serves a disadvantaged community in the Indian Wells Valley groundwater adjudication. I'm here today to speak in opposition of the Bill because first, it imposes a barrier to settlement. This frustrates the stated intent of both Sigma and the 2015 Streamlined Adjudication Act.

The Bill is also unnecessary because the court, in an adjudication action, already has a constitutional duty to maximize the amount of groundwater that can be withdrawn while preventing against undesirable results. This is the same standard that's contained in Sigma. The court in an adjudication also has continuing jurisdiction to adjust safe field where new information comes to light that shows that's appropriate. And again, this is consistent with the ideals of Sigma.

Courts have been exercising this duty for approximately a century, and courts provide important due process safeguards that are entirely absent in the GSA's Sigma process. The Bill is also unnecessary to protect small pumpers because existing law already requires that the court find that small pumpers are treated, quote equitably in imposing a stipulated judgment. And small pumpers are also commonly exempted from paying fees. And there are other mechanisms that courts and adjudications have to lessen burdens on small pumpers.

Last, we're concerned that the Bill improperly elevates the findings of the GSA. Those findings may be the subject of independent judicial review and challenge under Water Code Section 10726.6, which permits challenge to GSA actions. And I'll give you an example from the Indian Wells Valley. There, the GSA allocated zero basin groundwater to my client, Mojave Pistachios. So the GSA got to sustainability by picking winners and losers. DWR, in its review are you the.

Only main opposition witness?

Yes.

Then you exceeded the two minutes, but I'll let you finish your statement.

Thank you. I appreciate it. So in the Indian Wells example, we have a pending lawsuit challenging the GSA's allocation approach. DWR, in its review of the GSP, expressly limited its review to quote technical sufficiency and not the legality of the allocation methodology. And just last year, Senator Stern sponsored SB 1372 to clarify that when DWR approves the GSP, it is not passing on whether the allocations are consistent with groundwater rights law. These are important legal determinations that are the role of the court.

And so for these reasons, we ask for your no vote on the Bill. Thank you.

Thank you very much. Then this would be the opportunity for anyone to do a me too in opposition to the Bill. Just name, organization and that you oppose.

Thank you. Good morning, Mr. Chair. And Senators Rosanna Carvaco Elliott on behalf of the California Groundwater coalition. Also in opposition. Thank you. Good morning. Darian Key on behalf of Meadowbrook Dairy in opposition. Thank you very much. John Moffatt on behalf of the Milk Producers Council, in opposition. Thank you.

Welcome, good morning. Brenda Bass on behalf of the California. Chamber of Commerce, Western Growers and the. Association of California Water Agencies in opposition. Thank you. Thank you very much. Good afternoon. Taylor Roshan on behalf of various agricultural associations in opposition. Thank you very much. Good morning. Lily McKay on behalf of United Water Conservation District, in opposition. Thank you. Thank you. Good morning. Trisha Geringer with Agricultural Council of California respectfully opposed.

Seeing no one else for me too is in opposition in the room. Moderator we will come to the teleconference line and this is the opportunity for anyone to do a me too in support or opposition. Just name, organization and position. Moderator over to you.

Thank you. And please press one and then zero to get in queue for support or opposition of AB 560. We'll go to line 71. Yes, doreen. Conaway Baker, Sierra Shadows Ranch. I oppose. Thank you very much. Thank you. We'll go to line 134. This is Gail Dillahan with Western Growers Association. We're in opposition. Thank you very much.

We'll go next to line 123. Line 123, your line is open. Please unmute your phone. If you're muted, we'll move on to line 135. Mr. Chair and Members, Roger Dickinson on behalf of Civic Well, formerly the local government commission in support. Thanks very much. Thank you. We'll go to line 137. Donna Hawker Richcrest Area Association of Realtors Office opposition. Thank you very much, Mr. Chair, we have no further in queue.

Thank you. We'll bring the matter back to the committee for questions or comments. Senator Niello?

Thank you, Mr. Chair. It seems to me that this Bill might arguably be unnecessary. It says that the proposed decision shall be submitted to the State Water Resources Control Board. The court can already ask for that, can they not? If it's deemed necessary, yes, they can. But the State Water Resource Control Board doesn't have to respond, and they have not been responding. I understand that, but still the court could request it. And it seems to me that the term shall means that they will have to.

Which means that this Bill requires that the Executive branch participates in the decision of the Judicial branch. Now, it's kind of subtle, but it seems to me there could be a serious separation of powers issue here. Has ledge counsel opined on that?

Ledge Counsel helped us craft this language, number one, and the Judicial Counsel feels very strongly about protecting that. And that's why the judicial counsel recommended that this doesn't require the courts to submit the language, but that the parties who want to offer a settlement are required to go to DWR and the State Water Board and get a non binding advisory opinion about the consistency of the settlement that they are going to propose to the court.

And there are multiple situations where we require people who are proposing settlements, et cetera, to go through various steps as part of their settlement proposal process. This is just one for groundwater.

Does that complete your questions and comments? Thank you very much. Any other questions or comments, Senator Stern?

Thank you, Mr. Chair. Thank you, Senator, for staying on this issue. It's right in our backyard and it's everywhere. I worked on legislation in this arena, and I think even as your opposition noted, we weren't trying to over endow the judicial process with too many strictures here. We still want that to work.

What I'm hoping is with this legislation, that you're going to get input that's going to make these proposed settlements more durable, that ultimately bringing in the resources that we're talking about can put us on a path to sustainability. Not just in the context of that one brokered agreement, but in the longer term as we implement the fullness of sigma. And I think it's hard to wrestle with, I think, for the opposition, because it's so hard to get to one of these to begin with.

That's why we had an expedited adjudication process and we built that into Sigma originally. But I view this as, at least under the current circumstances, especially with the pushback and the lack of cooperation on what would otherwise be local protections, say, before folks are sort of racing each other to bury the deepest straw or rush to the pump house or all the other sort of things that are happening. If we had more protections in place, I don't think this would be necessary.

But because those aren't in place, I think this is. So I think it's necessary legislation and the four month allegation, I'm not sure if that's actually written into the Bill or not in terms of the time that it would take. But my sense is that you're committed to making this process not just non intrusive, but also expeditious so that it really can be sort of a strengthening piece of input. Do you care to comment on that?

That sort of concern that this would derail for taking too much time. Maybe in your close too? If you wish, I'm happy to move the Bill, but I thought give you a chance to respond.

Actually, we have a motion. Are there other comments? Seeing none. Then you can close and I'm sure you'll respond to Senator Stern's comments.

Thank you very much. And that is one of the important things that we appreciate to work with judicial council and the state water board and DWR in terms of trying to figure out what that length of time was. But the biggest thing is that when the proposed settlement is offered to the court at the very initial moment, this step already has to be done. And so I think it doesn't have a significant impact at all.

Whereas before, the concern was the settlement might not be presented to DWR until right before the judge was getting ready to finalize a settlement that would have potentially caused a delay, this will be much earlier in the process. And so I think there should not be a significant impact. And that's part of why judicial counsel was much more comfortable with this approach.

Is that complete? You're close?

It does. I respectfully ask for an aye vote.

Good. That's what I second for the motion looking for. We don't need a second in the Senate.

Oh, there you go.

We're very pontifical. So if you would please call the roll.

This is file item number 9, AB 560. The motion is due passed to send an appropriations, Umberg Wilk Allen aye Allen aye Ashby Caballero Durazo Laird aye Laird aye Min Min aye Niello no Niello no Stern aye Stern aye Weiner.

I think that's four to one and we will put that on call.

Thank you for the motion.

And while we were taking a while on that Bill, Assemblymember Bauer-Kahan had been waiting here patiently. Assemblymember Addis walked in. So let's go to Assemblymember Addis. Assemblymember Wallace just knew his moment hadn't come and he left. So Assembly Member Addis, AB 1147. Welcome to the committee.

Thank you so much. Chair and Members, I'm here to ask for your aye vote on AB 1147, which is a bipartisan piece of legislation that will expand and improve access to services for Californians with disabilities. I want to thank the many passionate advocates, organizers and supporters who have spent countless hours working on this legislation. Typically, we have about 200 people show up to the hearings and meetings that we've done. And so we know, this is incredibly important to people across California.

I do accept the committee amendments today. So, as you know, there's an immense gap between the services that individuals with disabilities need and the ones that they serve or, excuse me, the ones that they receive. And I've witnessed this personally as a special education teacher prior to being elected to the State Assembly. This is especially the case with California's 21 regional centers, which contract with the Department of Developmental Services to provide assessments, determine eligibility, and offer case management services for individuals with intellectual and developmental disabilities.

In June of 2022, the California State Auditor found a number of deficiencies. Disability Voices United also found that people of color are treated significantly different and receive far fewer services than Caucasians. The Public Council's report on racial and ethnic inequities among children served in the regional centers found similar disparities. And the Little Hoover Commission also found issues. So while the DDS has embarked on a number of initiatives to improve, there are still issues around equity, accountability, and transparency.

For the sake of this committee, AB 1147 adds a Public Records Act requirement to the regional centers, which are currently not subject to public records disclosures, despite serving a public purpose and being funded with government dollars. Although clients and families can obtain some information from DDS once it is passed along from the regional centers, the available information is insufficient. And what we hear from many families is that there's an opaque system where they really don't understand what is going on.

So by enacting reforms, California will support and help meet the needs of individuals with intellectual disabilities. And we have David Panish here to testify and support.

Welcome back to the Senate. You have two minutes to present.

Thank you, Mr. Chairman, Senators, David Panush representing Disability Voices United, proud co sponsor of this legislation. Disability Voices United is a statewide organization of self advocates and family Members who receive regional center services. And I actually have a nephew that's 28 years old that's one of them. We're urging an aye vote on AB 1147 to begin the process of restoring trust and confidence in the regional centers that serve about 400,000 Californians with intellectual and developmental disabilities.

AB 1147 creates a pathway towards greater accountability, transparency, and equity with respect to the Public Records Act. It's also an important step toward improved transparency, so that folks on the outside have a much better idea of what's going on on the inside. In conclusion, we just want to thank the Chair and the Committee and Committee staff for helping to guide us through this process, and, of course, our author, Assembly Member Addis we urgent aye vote. Thank you.

Thank you very much. Is there another primary witness in support seeing? No one, this would be the opportunity for anyone to do a meet in this room to do a me too in support name, organization, and position seeing none. Are there any primary witnesses in opposition.

Good morning. My name is Amy Westling and I'm with the Association of Regional Center Agencies, also known as ARCA, and we proudly represent the 21 regional centers. It's important to note that the regional centers are committed to transparency and our opposition to the requirement related to the Public Records Act isn't related to an attempt to hide information. In fact, our proposed amendment to this Bill would have instead made more information more readily available to the public at large.

Regional centers post a tremendous amount of information on their websites and they communicate information to the Department of Developmental Services through data transfers on a daily or monthly basis, depending on the type of information, as well as are subject to audit. And all of the information obtained through audit is then publicly available as well. The analysis noted that the sponsors had stated that at times the Department of Developmental Services does not have the information that it is statutorily required to collect.

We are committed to streamlining that process, to working with them to get the information that they are already obligated to have in their hands so that it can be publicly available. We're happy to do that through regional center contract.

And additionally, we're happy to post information that is of the greatest interest to the greater public on regional center websites related to the decision making, related to procurement of services, which is the piece that we've heard from the sponsors that individuals often find the most opaque and the most difficult to navigate. So with all of that, we respectfully request a no vote.

Thank you very much. Anyone else in the room in opposition? Seeing no one. Moderator then it's time for you. This would be the opportunity for anyone in support or opposition to Assembly Bill 1147 to just state their name, organization, and position in support or opposition. So over to you Moderator.

Thank you. And to speak in support or opposition of AB 1147, please press one and then zero at this time and we have no one in queue. Mr. Chair.

Thank you very much. We'll bring the matter back to the committee for questions or comments. Senator Niello.

Thank you.Thank you, Mr. Chair. I'm going to support the Bill, but I think the concerns that the Association has are legitimate. And I'm wondering, have you not agreed to accept amendments that might satisfy their concerns or are you still talking to them about it?

Well, we have agreed to the Committee amendments. I think we believe that the Public Records request is very important for these agencies to lend the transparency that I would say thousands of people across California are asking for. Certainly always willing to engage in conversation with opposition. But in this particular point, I think it adds a level of transparency that so many people have requested that it's hard not to respond to.

And I get that. But if I understand correctly, this also allows a private right of action relative to that transparency. Correct?

Maybe I'll turn over to our lead witness here.

Senator, I think it's the same requirements that are in the Public Records Act. So if that's what you're referring to, I don't think there's anything special that we're adding.

Okay, thank you for that.

And that completes your questions or comments. Any other questions or comments, Senator Stern?

Just comment and maybe you can respond in your close. The idea of trying to get timely, useful information, especially people who are desperate for services out there, and I know people are operating from that situation where they're desperate for service. They don't know why certain things have been closed and others haven't. Those are the heartbreaking stories that can make or break families all the time. So this is heavy duty stuff, and I'm really glad you brought this forward.

I guess, talk us through maybe in your close, how you see this legislation taking effect, and maybe after the wave of PRA requests or whatever it is, that we sort of seek how to operationalize that information. Right? I'm drawn to this idea of something more like a dashboard or something more like having really portable and similar metrics.

Some of that we will get out of CPRA, but some of it will sort of it'll engender maybe a new data sharing regime out of that that becomes useful to the clients. So just if you can sort of look, take us ahead in terms of how you think this will function, and if there is a pathway for something that, again, becomes more operational data as opposed to having to be based on request only and sort of that reactive mode. But I'm happy to make a motion, though.

I'll take that as a motion. And let me ask if that completes your question.

It does.

Then if there are no other questions or comments, we'll allow you to close and address that question in your close.

Well, I do believe the oppositionists and the Regional Centers in General, and all of the service providers are putting a lot of effort into making the changes that are needed. I would say in the ideal world, we don't see one Public Records Act because racked requests, because it's not needed. Right? Because the improvements are there. There are a number of steps that DDS is taking, and this is one piece of a much larger puzzle. Your idea of a dashboard is a wonderful one.

I think our witnesses and other folks working, other advocates are working on actionable ideas that are going to be helpful to clients, but also that the regional centers are stepping up. So I think it is a work in progress, and this is one small piece of that puzzle. And I respectfully ask for your aye vote.

I was just going to ask if that was the case. Thank you very much for your close. Would you please call the roll?

This is file item number five, AB 1147. The motion is due pass as amended to the Senate Appropriations Committee. Umberg? Wilk? Allen? Aye. Allen aye. Ashby. Aye. Ashby aye. Caballero? Durazo? Laird? Aye. Laird aye. Min? Aye. Min aye. Niello? Aye. Niello aye. Stern? Aye. Stern aye. Wiener? Six to zero.

You have six votes, which normally would be enough, but we're going to put it on call and wait for the other Members. And thank you very much.

Thank you so much.

I think the file order system causes people's stomach lining to eat away and Assembly Member Aguiar-Curry just walked in. Is she here? And Senator Bauer-Kahan, I just apologize. You've just been waiting forever and every time you're almost there, somebody walks in. This is the last author before you're listed on the file. So. Senator Aguiar-Curry, welcome to the committee. This is file item six, Assembly Bill 473. No, we already.

Good morning Members. I'm here to present AB 473, which will update the rules governing the relationship between auto dealer franchisees and the manufacturing franchiseors under California new motor vehicle franchise law. First and foremost, I would like to thank Senator Umberg for his support. And I want to give a heartful thank to all the committee and staff that have worked on this Bill, and I will be accepting the committee amendments.

We have repeatedly met with your staff, with the staff, the manufacturers and their association, and will continue to do so. We feel we have made significant progress in understanding each other's positions, exchanging language, and have already taken significant number of amendments during the process. We have removed the most controversial provision on time allocations for warranty and recall work, and several other sections of the Bill, including two more with the acceptance of the committee amendments today, I will continue, we will continue to engage with the opposition.

Senators AB 473 is about fairness. Global automakers are massive multinational corporations that are in a much stronger position in their relationship with local dealerships. Dealers are wholly dependent on auto manufacturers for the supply of cars to sell and the parts used in repairs. Like any complex law governing a dynamic industry, periodic updates of the franchise law are needed to address changing behaviors and conditions and level the playing field in the relationship.

Given your full agenda, I will focus my opening remarks on just a few provisions, and I'm happy to answer questions on the other provisions. One of the biggest provisions of the law protects franchisees from direct competition from their franchiseor. This Bill clarifies that manufacturers cannot do this by creating or acquiring companies that will remain in their control and directly compete with the franchisees.

This leaves consumers without local dealerships available to service their vehicles, and it will result in the loss of jobs and small businesses in our district. This protection does not hinder innovation or investment in the EV space. Manufacturers are free to invest in EV startups. However, they cannot claim that subsidiaries meant to undermine the franchise system and our local dealers are independent companies. For instance, neither Rivian nor Tesla are impacted by the competition provisions in this Bill, even though the former had significant backing from a manufacturer.

We've amended these provisions to ensure consumers can get software updates to service their vehicles over the air and to make sure that new companies can be integrated into the franchise model. Today, we are amending it to make sure that it does not impact fleets or autonomous vehicle operations. Another important provision of the Bill provides needed protection for the consumers. To specify that auto manufacturers can only charge consumers subscription fees for their vehicle, features that require ongoing work and costs of the manufacturer. That is fair.

Unfortunately, manufacturers plan to use ongoing subscription pricing for automotive features that are already built into the car, cost nothing to activate, and require no additional work by the manufacturer, hiding the actual cost to the consumer. The language in this Bill is simple. If there are ongoing costs to the manufacturer, they should be able to charge an ongoing subscription fee.

If there are no ongoing costs, they need to change a fixed to charge a fixed one time fee at any time the current or future owner wishes to activate them. Subscription creep or junk fees have become so prevalent that they're even referred to in this year's State of the Union address.

Ongoing costs for automobiles, especially for features that improve safety, should not be hidden as an ala carte items and lumped into the subscriptions where pricing can be changed over the years, even if there are no ongoing costs to the manufacturer, disclosures do not solve this problem. It is reasonable to expect a consumer to it is unreasonable to expect a consumer to fully grasp the additional costs while signing dozens of documents during the final moments of a vehicle purchase. We've all been there.

In the interest of time, we'll stop with that. I'm happy to answer any questions on the provisions or others in the Bill. With me today to testify to support AB Four 73 is Kenton Stanhope of the California New Car Dealers Association, and Anthony Bento of CNCDA is also available to answer technical and legal questions. Thank you.

Welcome to the committee. You have up to two minutes.

Thank you, sir. Mr. Chair, committee Members. Kenton Stanhope on behalf of the California New Car Dealers Association, sponsors of AB 473, I would like to use my time today to discuss the dealer's number one priority of the remaining provisions in the Bill, which is the unfair competition provision. Current law prevents any franchise manufacturer or their affiliate from competing with their franchisee in the same line make the vehicle. The whole idea behind this law is simple.

Car dealers invest money into their businesses and into their communities with a very reasonable and fair expectation that their own franchiseors do not compete directly with them. If that expectation is breached, then the very existence of their business is called into question. The purpose of this existing unfair competition provision in current law was never intended to allow a franchise automaker to simply rebrand a line, make, or create a subsidiary to circumvent the franchise law entirely and sell direct to consumer around their existing dealer network.

AB 473 simply does what the law was always intended to do. By precluding this type of practice, for reasons we don't understand completely, some of the opposition has argued that the unfair competition provision is somehow anti EV or will stifle EV sales in California. We agree with the committee analysis when it states, and I quote, nothing in this Bill prevents a company from manufacturing EVs or selling EVs in the state.

Expanding on that point in the analysis, if a company is not an affiliate of a franchise or manufacturer, AB 473 does nothing to prevent them from selling outside the franchise system and direct to consumer, which is exactly what Tesla and Rivian are doing right now. As the author noted, we are not stopping this. We are not stopping any company from doing the same.

Additionally, AB 473 does not prevent a subsidiary or affiliate, as defined from using their established dealer network of their parent company to sell the rebranded vehicles in California. The latter is currently happening today with several franchised automakers. A good example is Volvo. They created an all EV brand called Polestar that provides a Tesla like consumer experience that does not compete directly with their franchisee partners. In fact, it involves them.

Are you only primary witness?

Yes. Yes, sir.

Then I'll let you go a little over the two minutes.

Thank you, sir.

You've reached that.

The Polestar brand is being sold today in California with no issues. We suggest that other affiliate brands adopt a similar model if they remain a subsidiary of an existing franchise or automaker. In some, AB 473 takes a measured approach to resolving what is a serious threat what is a serious threat to dealers and businesses in your communities. With that, I'd like to thank the Speaker Pro Tem and her wonderful staff.

They have facilitated and guided hours upon hours of negotiations between dealers and manufacturers that have resulted in a better and balanced, more balanced Bill today. I would also like to thank the Chair, committee members and committee staff for all their hard work. I would also like to thank the OEM partners for continuing to come to the table and work out as many concerns as possible to AB 473.

With the removal, as the author noted, of the time warranty provision and coupled with the amendments today in the Judiciary analysis that the author has accepted, we are pleased to have resolved the remaining concerns of two of the largest automakers in the manufacturer coalition. CNCDA respectfully requests your aye vote. Thank you.

Thank you very much. This would be the opportunity for anyone to do a Me Too in support that's in the room. Just your name, your organization and your position of support.

Welcome James Lombardo on behalf of the California Motorcycle Dealers association in support. Thank you.

Thank you very much.

Mr. Chairman, Senators, Carlos Gutierrez on behalf of CarMax in support.

Thank you very much. Is there anyone else seeing? No one. Then we will move to opposition in the room. And I don't know, Mr. Moffat, are you the only primary opposition? There's two. Then you each have up to two minutes. Welcome to the committee.

Thank you, Mr. Chair, Members of the committee. John Moffatt on behalf of the Alliance for Automotive Innovation. We appreciate the committee's work and the amendments suggested by the committee. There are a number of issues remaining in the Bill that we hope to be able to resolve. I'd just like to focus on one raised by the committee in Section B of the analysis regarding subscription services. We think the Bill is premature in this area.

This is a practice that's not actually happening right now, but the Bill bans it before it's even something that's explored out in the marketplace. This is an amazing device, and it does what I want it to do, and it doesn't do the things that I don't want it to do. And I don't have to buy it all up front. There's no reason why the technology and the way it is going today, especially with ZEVs in vehicles, can't be the same.

Right now, you go in, you buy a car, it's got the standard options and a price for that. It's got all of the other additional options and the price for that, and you either want that car or you don't. We envision a future where cars roll off the line in a more standardized way and then could be tailored by the consumer to include the options that they want, but not include the options that they don't want. We absolutely agree with the author.

Those are decisions that should not have to be made by the consumer. In the finance room, at the dealership, subscriptions and other types of activation features are decisions that can be made by the consumer two weeks, two months, two years after they've purchased the car. They can make decisions on how they will use the car, how their family will use the car. It gives them options moving forward without having to pay for all of that upfront, whether they're going to use it or not.

Those same principles apply to the next buyer of that vehicle. If all things have to be included at the beginning in the price of the vehicle, then that used car buyer is paying.

Sir, you've reached two minutes. Could you wrap up?

I will. Thank you Mr. Chair and Members of the committee, we ask for your no vote today on the Bill.

Thank you very much. And then we'll have the other primary opposition witness. You have up to two minutes.

Thank you. Mr. Chairman Members, Theo Pahos representing Ford Motors. We still have some concerns with electrical charging provisions in the Bill. We have concerns about other provisions, but because of lack of time I'd just like to focus on the EV provisions of the Bill. Ford has taken very seriously the goals that have been aligned through the last two Governors on electrical vehicle sales.

I'd like to point out that it was in fact a Ford Mach E that Governor Newsom signed the prohibition on internal combustion engines by 2035. By 2030, we're supposed to have 5 million EVs on the car excuse me, on the road. This is a mandate on manufacturers. It's not a mandate on either dealers or consumers. So by 2030, we have to get 5 million of these on the road, we have a little bit over 1.5 million. Now, that's a huge ramp.

So we have instituted a program that's called the Ford EV Program, where dealers can voluntary opt into this program. They get the big allotment of electrical vehicles in this instance. And then we ask that they also put in the highest level three chargers that are publicly available. Our intention is so that Ford owners can use that charger when they need a charge and that it'll be put on the Ford software known as Ford Pass.

So if you driving a Mach-E or one of our other electric vehicles made these Ford Lightning 150, you're worried about charging. Well, you know, you can always go to your dealer and get a charge there, and the dealer could pay for that to reimburse themselves for the cost of putting this charger in. We think that this will go a long way in easing the concern of people on range anxiety.

We believe it'll be an effective tool in selling electric vehicles at the pace that we're required to in California and that we just ask that that provision be modified after this committee hearing such that we can continue to work with the dealers and implement this program because we think this is vital to meeting the state's EV sale requirements. And for that reason, we still remain opposed.

Chair, Members. Jonathan Feldman with Arc Strategies on behalf of BMW. Appreciate the author and the amendments up to this point, but we remain opposed.

Thank you. We appreciate your comments. Those are the two primary witnesses in opposition. This would be the moment for anyone in the committee hearing to room to do a too in opposition to this Bill. Just name organization and position in opposition. Welcome to the committee

Thank you.

Voleck Taing with the Silicon Valley Leadership Group. We also remain opposed. Thank you.

Thank you very much.

Lizzie Cootsona here on behalf of TechNet, with a respectful opposed and less amended position. Thank you.

Thank you very much.

Kurt Kimmelshue on behalf of Scout Motors with an opposed and less amended position and also the Civil Justice Association of California in opposition. Thanks.

Thank you very much.

Dean Talley with the California Manufacturers and Technology Association. Respectfully opposed.

Thank you. Seeing no one else, we will now go Moderator to the teleconference system. And this would be the opportunity for anybody on the line to do a Me Too, either in support or opposition. Name, affiliation, and position. Moderator over to you.

Thank you. To speak in favor or opposition, press one, then zero. At this time, we will go to line 50 pardon me, 153. Go ahead.

Thank you. Members, Ashley Walker, on behalf of the Motorcycle Industry Council, the Specialty Vehicle Institute of America, and the Recreational Off-Highway Vehicle Association, with a respectful opposed unless amended. Thank you.

Thank you.

And Mr. Chair, we have no further lines in queue.

Thank you very much. We appreciate that. And we'll get back to you, I'm sure, soon. Then let's bring the matter back before the Committee for questions or comments. Senator Allen.

I'd love to just clarify a little bit with Mr. Pahos, it was my understanding that earlier in the negotiations, this whole issue of the EV chargers had been addressed in the negotiations, and it sounds as though that may no longer be the case or you guys are still not seeing aye to aye on that.

No,

Through the chair, it seems you're willing to answer his question. Is that okay? Senator Allen? Okay.

No. Ford is not yet satisfied with the provisions in the Bill. I will say we are continuing to engage with the dealers on this, and we have a proposal on the table, but we're still uncomfortable with having to pay for half of the install of the charger. We've made our $50 billion investment in completely revamping our lines, building a battery manufacturing plant, zero carbon, carbon neutral, by the way.

But we would expect the dealers to pick up the full cost of the charging, particularly if it's just being used for Ford customers.

Thank you. Does that complete your question?

On that issue, yeah, and then I'd love to get-

And who are you about to direct this question to? Because you pointed to the audience.

Well, perhaps Kirk over here, I'm having a bit of or maybe Mr. Moffatt. The issue was raised about subscriptions. It's my understanding that obviously there's lots of different types of subscriptions, but that they're really focused on hardwired features capable of functioning at the time of purchase.

That's where the Bill is focusing in, and that's where they get a lot of complaints from people where, there will be a feature to heat the seats, and then the dealer, I guess, has to kind of deactivate that feature, and then they're charging $18 a month to be able to keep your seats heated, even though it was a feature that was already included in the car.

That kind of subscription I find really annoying, but I think some of the other ones, I mean, maybe the Scout model, I don't know, might be the kind of things that the consumers will be more interested in. I'd love to get better clarity as to what exactly we're talking about here with regards to your concern over subscription language.

Through the Chair, Mr. Moffat, over to you.

If I may. Thank you, sir. Your confusion is shared. This isn't happening right now. We don't know what this will look like in the future. That's why we think banning it today is premature. The example that's out there is heated seats that was never offered in the Western Hemisphere of the world, that was floated in South Korea and never actually happened because consumers pushed back. The system worked, right. And so that's the example. It's never happened here.

Yet we have a Bill here in California addressing an issue that never actually occurred in South Korea. But the underlying premise is accurate. We don't know what this looks like moving forward. All of the technology that's being built into vehicles, additional software from third parties and others that's being developed, we don't know, utilizing the components of the vehicle that will be hardwired into the vehicle, what it might be able to do in the future. And that's why our proposition is consumer protections disclosure.

California law already includes provisions on automatic renewal for subscription services that should certainly apply to this, but let's not ban it before we have the opportunity to explore what that technology might look like in the vehicle moving forward.

Okay, I'm reading over the language. You're right. There's a lot of unknown. Unknowns, I suppose, in terms of how technology is going to be progressing. Look, I know I've seen this, I'm in Transportation Committee and here, and every time you've been making really significant progress, Assembly Member, in addressing various concerns. And I'm certainly happy to continue that, to vote for the Bill today, but I hope that additional progress is made. Maybe -

Can I make a comment real quick? So just to be clear, the Bill is not a ban on subscriptions. The Bill allows for configuration by the user and future users. It just sets guidelines for the use of subscriptions and making pricing more transparent. So we're not banning anything. We just want to make sure we have some guidelines out there. So just want to make that clear. In the past, manufacturers defended subscriptions on safety features like blind spot alerts. So just want to throw that out.

Yeah, I understand. So, um-

I have expert witnesses if we want more information.

Yeah, thank you. I do hope that some additional work also goes into working with Ford on their charging program. And I understand it's a unique program and a little different than what other people do, but we do have ambitious goals and hopeful that you'll be able to figure out some of the issues that they've raised because Ford is a big part of our plan to meet our ZEV goals.

Well, where I might differ a little bit is that Ford wants dealers to pay for public chargers and not for their customers. So there's a lot there. I just don't know that this is what they want. But I don't know if Kenton wants to speak. Do you mind?

What do you mean, what they mean.

Based upon one of the witnesses who was here?

Well, I think my understanding, their concern is how this is going to potentially jam up their existing program for the rollout of charging for Ford vehicles around the state. So that's my understanding. But obviously, love to hear your thoughts

Through the Chair if you've got a brief addition.

Yes, sir. So on the DC charging issue that Ford's talking about, their main problem is that their program they're the only OEM that is asking dealers to build out public facing-

I'm sorry. OEM?

I'm sorry. The manufacturers, original equipment manufacturers.

Thank you.

Yeah. They're the only ones with the program that's requiring dealers to put a public facing charger on their lot. The only thing we're asking them to do in the Bill is to have some skin in the game and split that cost of installation and maintaining that charger.

For charging programs that are requiring dealers to have a charger on site for the sale and service of their inventory, the dealers are willing to foot that cost on their own, like they do with the rest of the infrastructure on their dealership. This does nothing to prevent the Ford Model E program from moving forward.

We just ask that they have some skin in the game when they ask us to do something very new and original, which is turning our dealerships into charging stations for the public, which we find very reasonable. The other things in the DC fast charging, we've pulled out the pooling exception. We've also changed it from encourage to coerce, meaning that their program, if it's not coercing us to do it, would not fall under the provisions of the Bill that's going in the amendments today in Judiciary.

So it's really a discussion of whether or not they want to pay 50% for a public charging on a dealership lot. And that's where we're still continuing to have negotiations with them on, and we will continue to have those.

Okay. I thought I heard the gentleman from Ford say specifically, this is about for customers.

Right now. It's a public facing program. It's not for Ford only customers. Now, that's something that we're willing to have a conversation with Ford about and that's we've already kind of started those conversations.

Okay, good. Thank you.

Does that complete your questions? Sure. Senator Niello, you were in line.

Thank you, Mr. Chair. I'm one of many, many hundreds, perhaps thousands of franchisees in the state, so I don't really have to recuse on this. But in an abundance of caution, I will recuse myself.

Thank you.

Thank you very much. Hopefully, we'll have enough people by the time it comes to a vote. Senator Stearn's in line. And then Senator Ashby.

Thank you. Thank you, Senator, for bringing this forward. Just listening to testimony, I feel like the central issue, at least around this charging one, is is a 50/50 split the right number or sort of what is it supposed to be going forward? I know you'll keep working on that issue. I know there's a unique program. I think the Bill is overall in good shape. I think there's space to land these things. But I'm happy to make a motion at the appropriate time.

I just would say, yeah, I do hope before the floor. Look, we don't want to get in the way if they're pushing out hydrogen fuel cell cars or EVs or whatever it may be, let's not do anything to get in the way of it and try to find some arrangement that will not force an undue burden on the dealers, but also not be a deterrent to the manufacturers. I'm sure you'll find a way to land that. So thank you.

That's the plan.

Okay. Senator Ashby?

Yeah. I want to sort of echo those same comments as Senator Stern there. That, first of all, this is a tough one because it's an important industry, but it's a paradigm shift, as you have said many times, I think, during these hearings. We have these really big goals in California. This is an important industry we need to bring along with us. You have good actors on both sides of this discussion. You also have a really good author.

I know you'll keep working on it for as long as you can, but I also just wanted to chime in to say that while every legislative Bill should seek to do something good, every Bill can't do everything. And so this may, I doubt this will be the last time we see this topic. I'm sure there will be another Bill after this that continues to address these issues.

And I appreciate the author leaving the breadcrumbs that need to be there to have a really robust dialogue around this in the years to come. The last thing that I just kind of want to say on this one is know I think that Assemblywoman Aguiar-Curry has done a really good job here of having robust dialogue. I've been tracking this Bill from the beginning, and there are a lot of issues that you have resolved to get to this point as it is.

So I know you'll keep working on the last few remaining. I think the issue with Mr. Peos and Ford is really close to being resolved. Hopefully that one can be kind of finalized and then some of the other issues if we don't.

I guess my commitment as a new Senator is to continue to work with you no matter what happens with this Bill, to work with that industry to make sure that we push forward and that we bring everybody along who's willing to be a good innovator and partner to the state of California's lofty goals.

Thank you very much. Any further comments or questions, then we have a motion by Senator Stern and you can close.

Thank you.

Great. Thank you very much. Thank you for the. Discussion today, and I took this Bill on because I have a local leader who's been telling me for years about the problems this Bill could solve. We have already taken, like you've known, extensive amendments. We will undoubtedly take more as the process proceeds to make this Bill as balanced as possible. I look forward to continuing the conversations with the opposition today.

I'm asking you to support your local businesses and their employees who work daily to ensure that our communities can access and service motor vehicles. I respectfully ask for your aye vote.

Thank you very much. And then you can please call the role on Assembly Bill 473.

This is file item number six, AB 473. The motion is due. Pass is amended to the Senate Appropriations Committee. Umberg? Aye. Umberg, aye. Wilk? Aye. Wilk aye. Allen? Allen aye. Ashby. Aye. Ashby aye. Caballero? Duraso? Duraso aye. Laird. Aye. Laird aye. Min? Niello? Stern? Aye. Sternaye. Wiener. Seven to zero.

Very much.

Thank you very much.

That's on call.

I didn't hear what he said.

I'll tell you what he said. He called you Senator Bauer-Kahan. And I said, that's not quite correct. And he said, she will be by the time this hearing is over.

She's also presenting for somebody else.

Yes. I was sitting here waiting for the Chair to come back. That's why I waited. Well, that's glad that worked out.

You need not do that.

The chair was actually here, and that's incredibly shameless.

All right, you missed.

But yes, Mr. Chairman, Assembly Member Petrie-Norris has asked me to present AB 571 as well, if you don't mind.

All right, thank you.

But we can start with my Bill, AB 1720. And I will be brief because I know you have a lot before you, so thank you. Members today I'm presenting AB 1720. It's a simple Bill to ensure ultrasounds are provided in licensed settings or by medical providers. Ultrasounds are some of the most intimate and revealing medical tests an individual can receive. A misread ultrasound can therefore be utterly devastating. Unlike other states, ultrasounds in California do not require a specific certification or licensure.

Amendments I took on this committee, as promised in the prior committee, expanded exemptions for licensed providers that I'm committed to continuing to work with stakeholders to ensure the Bill is restricted to unlicensed ultrasounds. Only with me in support was supposed to be Ryan Spencer with ACOG, but I think he's downstairs on another Bill. Oh, he's running up, I'm told.

All right. Support. If you're in support of AB 1720, please approach the microphone. All right, here comes support.

Perfect timing.

We'd like you to run in place and present.

I got my cardio in today, sir.

Alright.

AB 1720, right?

Yes. You're doing great.

I have a couple, I have a couple. Thank you. Mr. Chair, Members, Brian Spencer, on behalf of the American of College of OBGYN District IV in support of 1720. I swear I'm in better shape than this.

It happened to me recently in public safety, and we all feel it.

Our providers utilize ultrasounds to monitor pregnancy as well as diagnose, and monitor medical conditions that are not related to pregnancy, such as causes of pelvic pain, abnormal uterine bleeding, or infertility. They are an essential part of healthcare and should be treated as such. Staff who utilize ultrasounds at unregulated and often non medical facilities have no legal obligation to provide pregnant people with accurate information, and are not subject to HIPAA or required by law to maintain client confidentiality.

Equally concerning is the use of ultrasounds to emotionally manipulate and shame pregnant people under the guise of informing or diagnosing them. Additionally, while there's currently no evidence ultrasounds are harmful to a developing fetus, it is possible that effects could be identified in the future. Therefore, casual or nonmedical use of ultrasounds during pregnancy should be avoided and performed only for medical reasons by a qualified healthcare professional. An AB 1720 can help provide these necessary protections by ensuring ultrasounds are performed only in regulated medical facilities.

For these reasons, ACOG supports AB 1720 and asks for your aye vote. Thank you.

Thank you very much. Others in support, please approach microphone. All right, seeing no one else approaches the microphone, those who are opposed, please approach the microphone. We would request that you run so that the playing field is level. All right, seeing no one approaches microphone, let's turn to the phone lines. Moderator, please queue up those in support and opposed to AB 1720.

To speak in support or opposition, please press one, then zero. At this time. Mr. Chair, we have no one queuing up.

That's unfortunate, because I just ate something. All right, so bring it back to Committee. Senator Ashby moves the Bill. Any questions? Comments? All right. Would you care to close?

Respectfully ask for your aye vote.

Thank you very much. Madam Secretary, if you call the roll.

This is file item number eight, AB 1720. The motion is do passed to Senate Appropriations. Umberg? Aye. Umberg, aye. Wilk? No. Wilk, no. Allen. Allen, aye. Ashby? Ashby, aye. Caballero? Durazo? Durazo, aye. Laird? Laird, aye. Min? Min, aye. Niello. Niello, no. Stern? Stern, aye. Weiner? Seven to two.

Seven two. We'll put that on call. All right. Next is Assembly Member Petrie-Norris's Bill which is file item number 32, AB 571.

Thank you, Mr. Chair and Senator, as I'm presenting AB 571 on behalf of Assembly Member Petrie-Norris, which reduces barriers healthcare providers face when trying to offer reproductive health services here in California. Here in California, we obviously have been very focused on protecting reproductive rights. But one of the major barriers to access is the cost and availability of liability insurance for providers. Reproductive healthcare providers are often charged an arbitrary, surcharge, or even denied liability insurance altogether because they offer abortions or gender affirming services.

This Bill prohibits that discrimination and will help ensure that health providers are able to obtain liability insurance and serve their patients. With me today in support are Alexis Rodriguez from California Medical Association and Ryan Spencer from the American College of Gynecologists, who maybe caught his breath by now.

Indeed. Thank you, Mr. Chair. Ryan Spencer, on behalf of the American College of OBGYN's, District IV, co sponsors AB 571. In a time where states across our country are banning evidence based, life saving abortion and gender affirming care, ACOG is proud that California seeks to protect access to this care.

We've made great strides to enshrine the right to abortion, our state constitution, and reduce barriers for patients to receive this care hand in hand with these actions, we should also find ways to reduce barriers for physicians and other healthcare providers who provide this essential health care. This is where AB 571 plays an important role. OBGYNs already pay a lot for medical liability insurance. According to recent research, physicians may need to purchase costly abortion riders, which is concerning.

Evidence suggests that the large premiums for abortion riders are not proportional to the true liability risk. The medicine that our physicians practice is evidencebased, but as with all medicine, it is also fraught with potential risk. However, what is not risky is providing abortion or gender affirming care. Abortions are safe procedures. They're most commonly not performed in a hospital operating room. The overwhelming majority of abortions are completed in our physician's offices or even a physician's home if they choose to have a medication abortion.

The current difficulty some physicians and other licensed provider have in securing professional liability insurance has impacted the number of otherwise eligible practitioners who could offer these desperately needed services in California. The American College of OBGYN's is proud to sponsor AB 571 and ask for your support. Thank you for your time.

Thank you very much. Others in support of AB 571.

Good morning. Alexis Rodriguez of the California Medical Association, representing 50,000 physicians and medical students across the state. A proud cosponsor of AB 571. This Bill will ensure that licensed medical providers who offer abortion, contraception or gender affirming care are not denied medical malpractice insurance coverage or charged an unfair premium because they are providing care that has been outlawed in other states since the Dobbs decision was issued,

many states have imposed abortion restrictions or bans that make it difficult, if not impossible, for people to get care in their own communities. Which means that physicians and other providers in California are treating not only California patients, but an increasing number of patients who have traveled to California to obtain basic health care services.

AB 571 is one of the Future of Abortion Council bills and is necessary to help protect medical providers who might otherwise be denied coverage or charged a higher premium than is justified for their professional liability insurance coverage they need in order to be able to practice medicine. This Bill will help ensure that patients have timely access to care because their physician or other licensed medical provider won't have a barrier to obtaining and maintaining their medical malpractice coverage. With that, I respectfully ask your support today. Thank you.

Thank you very much. Others in support of AB 571, please approach microphone.

Good morning. Silvia Solis Shaw on behalf of the California State Association of Psychiatrists and strong support.

Thank you. Thank you. Seeing no one else approaches the microphone, let's now turn to the opposition. If you're opposed to AB 571, please approach the microphone. Seeing no one approaches the mic oh, I'm sorry. Go ahead.

Yes, my name is Greg Burt with the California Family Council in opposition to AB 571. I just wanted to bring up a couple of points that I did not see in the analysis. It's understandable that medical professionals want to protect themselves from lawsuits knowing the particular risk of either late term abortions or gender affirming care.

I'm also kind of surprised that the analysis didn't mention the two lawsuits that are currently been filed against Kaiser for giving double mastectomies to two teenagers who are both one was 13 and one was 15. Both of these teenagers are fighting lawsuits because they didn't understand the implications of damaging their reproductive systems and doing permanent damage to their bodies. One of those cases is Chloe Cole. She's made national news around the country testifying against bills against gender affirming care. The other is Kayla Lovdahl.

She's actually going to be here tomorrow testifying of several bills. She had her breasts removed at age 13. If you also have been paying attention to what's happening around the world, European countries are turning away from gender affirming care for minors because of the lawsuits have been filed by minors. Both England and Finland and Sweden are now no longer doing gender affirming care because of the risks and the side effects. This Bill doesn't take into account any of that. Insurance should.

Liability insurance is based on risk, right? And so insurance companies should be able to charge based on risk, and this Bill kind of ignores that. So for those reasons, we are opposing this Bill. Thank you very much.

All right, thank you. Anyone else opposed to AB 571, please approach microphone. Seeing no one approach the microphone, let's turn the phone line to moderator. Please queue up those who are in support and opposition to AB 571.

To speak in support or opposition, please press one, then zero at this time. One moment, please. We'll go first to line 15.

Mr. Chair and Members, this is Erin Evans on behalf of the California Nurse Midwives Association and NARAL Pro Choice California, both in support as co sponsors of this Bill. Thank you.

Thank you. Line 163.

Chair Umberg and Senators, Michelle Teran-Woolfork with the California Commission on the Status Women and Girls in support of AB 571. Thank you.

Thank you. We have no further lines in queue.

All right, bring it back to committee. Questions, comments by committee Members. Senator Niello.

Thank you, Mr. Chair. Insurance companies are not ideological, and I suspect that's why they're no part of this discussion. I'm quite sure they probably do not want to get involved in the pro life, pro choice debate. They are merely businesses who sell protection to people for risks based upon a premium that is supposed to assess that risk, to allow the insurance companies to collect more in premiums or pay out in losses. Now, the witness that testified in opposition stated that the Bill ignores this risk assessment.

It doesn't. The Bill takes over the risk assessment. And if this Bill passes, then the state has decided that whatever risk is involved in these particular procedures doesn't exist. And to the extent that it does, it's just going to increase the premiums of everybody else. So the insurance companies will continue to assess the risk, price their policies accordingly. And to the extent that state policies jump in the middle of that, they'll assign premiums as a result, and everybody else will pay more.

All right, thank you very much. Other questions? Comments? Is there a motion Senator Laird moves the Bill. Would you care to close?

Thank you. I would just note that the insurance companies are not here in opposition, that I respectfully ask for an aye vote.

Thank you very much. Madam Secretary, if you'd call the roll.

This is file item number 32 AB 571. The motion is do passed to the Senate Appropriations Committee. Umberg aye. Umberg, aye. Wilk. No. Wilk, no. Allen? Allen, aye. Ashby? Ashby, aye. Caballero? Durazo? Durazo, aye. Laird? Laird, aye. Min? Min, aye. Niello? No. Niello, no. Stern? Aye. Stern, aye. Wiener? Thank you. Seven to two.

Seven two. We'll put that on call.

Thanks Senators.

Thank you.

All right. Assembly Member Friedman floor is yours. Item number 12 AB 8.

Thank you, chair and Members. In the past, if you wanted to buy a ticket to an event, you would go to the box office and you would stand in line. The box office would tell you what seats were available and the price the tickets cost. You would receive a paper ticket that then you could use to enter the venue. And it was thought at that time that the online experience and the Internet would make buying tickets easier for consumers. And in some ways, that's true.

But in many ways, the opposite has happened. These days, you may not be able to find the price or the cost of a ticket until you've been online for hours and finally snagged a ticket. You then will put the ticket into an electronic shopping cart and often watch that ticket price increase every time you click through a whole succession of windows to get to where you finally purchase the ticket. Now, that's not an accident.

Online sellers have developed this model because they've done studies and they have psychiatrists who tell them that when you get a consumer to invest a lot of time in trying to purchase something on the Internet, that at the end of that time, they will feel that they are obligated to make that purchase. Even if the eventual purchase price is more than that. They told themselves they were going to spend and that they would have clicked on if they had originally seen that price advertised.

This is called Drip pricing. Now, average ticket prices have more than tripled since the 1990s, and the fees that are tacked onto each ticket can be as high as 78% of the ticket price. While consumers are feeling the pinch, ticket retailers are doing just fine. Last month, Ticketmaster Live Nation announced record profits, reporting a 2022, operating income up 125% from pre pandemic levels to $732,000,000, and revenue up 44% to $16.7 billion. Now, the laws governing ticket sellers were passed before the Internet even existed.

A fact that's become increasingly clear is mega ticket sellers and resellers have used these rules to rip off consumers eager to see their favorite artists. In 2015, shortly before abandoning all in prices, one ticket reseller did an experiment where half of shoppers saw all in pricing and half saw the lower base price, with taxes and fees only added onto the end. The latter strategy of Drip pricing increased revenue 20%. That's not fair.

At the end of the process, people feel they're locked into the purchase, and we are manipulating our consumers. We need to update the law for how tickets are sold to make sure that artists, performers, and venues can reach fans and sell tickets in an easier and more transparent way. AB 8 adds important new consumer protections. Now, we started this Bill with a lot more consumer protections than you're seeing now.

We had a transferability part of this bill that allowed people to give their tickets away or sell them, something that's often not allowed now. But because of fierce opposition from the industry, we've reduced it to what we think is really kind of the lowest hanging fruit and sort of no-brainer, which is all in pricing to protect consumers before they spend an inordinate amount of time and face the frustration of drip pricing. With that, I would turn to my co-author, Jacqui Irwin.

Thank you, Assembly Member Friedman. The list of frustrations that consumers have with the ticketing industry is long. Since consumers have no choice but to put their trust in the current ticketing marketplace, this monopolistic industry has become emboldened in their deceptive practices, depriving consumers of needed transparency in ticket advertising and the purchase process. In response to consumer frustrations, AB 8 will update current law, providing consumers with transparency when purchasing a ticket to a live event.

Specifically, AB 8 will require the full price of a ticket and fees to be displayed prior to selecting the ticket for purchase, prohibiting a ticket price from increasing during the purchasing process. These consumer protection provisions will apply to all primary and secondary ticket sellers, updating prior ticketing laws that have exempted primary ticket brokers. Lastly, AB 8 will prohibit a ticket seller from charging more for a printed ticket if the event is a cell phone-free event.

Through these needed provisions, AB 8 will protect consumers like me and you from outdated and deceptive marketplace practices that have financially harmed all of us. Ms. Friedman and I have worked on various amendments that have removed nearly all the opposition, and we look forward to continuing these conversations. Finally, with us this morning in support--or afternoon almost--in support of AB 8, is Rebecca Marcus on behalf of CALPIRG. Thank you.

Good morning, Chair and Members. Rebecca Marcus representing CALPIRG. CALPIRG is a statewide consumer watchdog and advocacy group working to protect Californians and ensure a fair marketplace. We are here today as proud sponsors of AB 8. One of the most basic tenets of consumer protection is transparency. Complete pricing information specifically is critical to help inform consumers' purchases and ensure a fair marketplace.

But more and more ticket sellers are violating this principle by blindsided consumers with hidden fees and other unfair tactics that can make it hard to find the true price of a ticket. AB 8 addresses this by ensuring a ticket's advertised price is the actual price, and ensures that seat location information and refund policies are available to the consumers at the time of purchase.

Additionally, AB 8's most recent amendments added language to better protect consumers from bots that can quickly buy large quantities of tickets and then resell them at inflated prices, often to the detriment of real consumers. Broad public support for ticket reform that has been brewing for the last several years, and these reforms offered by AB 8 are long overdue. As we emerge from the worst days of the COVID pandemic, Californians are looking for more and more opportunities to enjoy live events.

And as people rush to buy tickets for these events, the broken nature of the ticket selling system is becoming more and more clear. AB 8 offers common sense solutions. Thank you, and I respectfully ask for an aye vote.

Alright. Others in support?

Good morning, Mr. Chairman and Members. Robert Herrell, the Executive Director of the Consumer Federation, California. We technically have a support if amended, position. We appreciate the work the authors have put into the bill. We know how difficult it is to take on a monopoly, which is what you have in this industry. Our fear is that all-in pricing, a] it matters how it's done, and b] we fear that just doing all-in pricing precludes a much more comprehensive set of reforms that's necessary now.

And what the industry will do is they'll say, 'okay, all-in pricing.' And then they'll wait three, four, five, ten, forever if they can, to do the other things that are really important for consumers in this space. So we have a support if amended position and look for a more comprehensive package. Thank you.

Alrighty, thank you. Others in support?

Jamie Miner on behalf of StubHub. We also have a support if amended position. Would echo many of the comments just made by our colleagues at Consumer Fed, but really appreciate the author's dedication on this issue. We supported the bill in its original form, which we felt really moved the envelope when it comes to ticket reforms. Disappointed to see it become watered down over time, but look forward to continued conversations and thank you.

Alrighty, thank you. Others in support, please approach the microphone. Give us your name, your affiliation, and your position. Seeing no one approaching, let's turn to the opposition. If you're opposed to AB 8, please approach the microphone.

Andrew Govenar, Governmental Advocates on behalf of California's five Major League Baseball teams, MLB and the San Francisco 49ers. We have removed our opposition on the measure and wanted to thank the authors for working with us.

We apologize to the Committee for not formally--I thought we did that at our meeting--but having said that, we have technical changes that we've still requested on the fee transparency definition, which we worked on with--

Okay, so you are a tweener?

We are a tweener.

Alright, thank you very much. Alright. Others in opposition to AB 8?

Mr. Chair and Members of the Committee, Mark Aprea. I'm here on behalf of AEG and its ticketing division, 'Access,' as we did in Senate business and professions. We ask that this measure be held, and the reason is is that the two Senate bills won by Senator Caballero and Senator Wilk are held in the Assembly.

They'll be the subject of an interim hearing. Some of the same provisions in AB 8 are in Senate Bill 785, and we think that in order to get to that comprehensive reform that Mr. Herrell talked about, that everybody ought to be in the pool and we're recommending a bipartisan and bicameral interim hearing process along with work groups so that these issues can be finally worked through. Thank you for your time.

Thank you.

Mr. Chair and Members, Mike Carpenter on behalf of Live Nation. We're also a tweener. I do want to say that I frankly agreed with everything that the authors said about all-in pricing. We agree with them. We believe the first price a consumer sees should be the final price they pay. That said, I would agree with my friend Mr. Aprea from AEG.

It seems to me that a couple of bills flew out of this House with large bipartisan votes and are being held up in the Assembly, and in order to have the comprehensive conversation again that Mr. Herrell referred to, we ought to have both Houses engaged in this, and all of the bills ought to be part of the mix.

Thank you. Alright, others? Name, affiliation and position.

Tim Lynch on behalf of the Golden State Warriors and thank you to the authors for working with us. We've removed our opposition to AB 8.

Thank you. Alright, anyone else in opposition? Seeing no one else approach the microphone, let's turn to the phone lines for those who are in support or in opposition to AB 8.

To speak in support and opposition, press one, then zero. We'll go first to line 168. Line 168, your line is open. One more time. Line 168. If you would check your mute feature on your phone Hearing nothing. We'll go next to line 166.

Mr. Chair and Members, Alex Torres here on behalf of the National Independent Venue Association of California. We are in a tweener position as well. We've removed our opposition, but would align ourselves with the comments from Mr. Aprea and Mr. Carpenter. Thank you.

Line 165.

Salil Necholi, CONGUARD. I'm just a Niner fan, and I am in strong support of the bill.

Mr. Chair, there are no further lines in queue.

Alrighty, thank you. Bring it back to Committee. Questions, comments? Questions, comments by Committee Members? Yes, Senator Caballero.

Thank you, Mr. Chair. So let me just say that this has been one of the more interesting areas that I've ever done any work in. The Committee will remember that I, too, am working on a bill that would create the kind of consumer protections that are needed in this whole area of ticket purchasing. And every time you push it's like a balloon, every time you push on one point, it comes out in the other point.

And the reason I say that is because it's easy to think you understand exactly what needs to be done in order to ensure that the consumers are protected. And from my perspective, that the artists who are giving a performance get the value of their performance. When you talk to the different organizations, they have different opinions on what should happen. And so my bill has been made, a two-year bill in the Assembly.