Senate Standing Committee on Energy, Utilities and Communications

The Senate Committee on Energy, Utilities and Communications will come to order. Good afternoon. The senate continues to welcome the public in person and via the Teleconference service. For individuals wishing to provide public comment for today's hearing, the participant code number is 877-226-8163. That's 877-226-8163. And the access code is 3339998. That's 3339998. We're holding our committee hearing here in the Oak Street Building. I asked all members of the committee to be present at Room 1200, so we can establish a quorum and begin our hearing. We have nine bills on today's agenda. AB 691 by Assemblymember Ting has been pulled from today's agenda. Before we hear from our first author. We can establish a quorum, but we are without it. So we're going to start as a subcommittee. I see we have Mr. Holden here ready to present file item one, AB 41. Mr. Holden, when you're ready, you may begin.

Thank you, Mr. Chair and members. Today I'm here to present Assembly Bill 41, the Digital Equity and Video Franchising Act of 2023, or DEVFA. I want to thank my colleagues, Committee staff, and other key stakeholders for their willingness to work with my office on this very important measure. I accept the amendments proposed by the committee because they strengthen the Public Utility Commission's ability to investigate possible discrimination by state video franchise holders. The amendments do the following: Guarantees a longer review process of franchise applications, including a public hearing; Ensures low-income Californians will have equal access to video services and broadband-capable infrastructure; Allows the Public Utility Commission to set anti-discrimination benchmarks to investigate any anti-discrimination violations. If violations has occurred, the PUC can fine a franchise holder, revoke their franchise, or even require build-out as a remedy. I understand this bill is not where we started, but it makes substantive changes to the current video franchising laws that will ensure the PUC has meaningful tools to protect low-income Californians from discrimination and thus close the digital divide. In all, AB 41 is a strong antidiscrimination measure that will work in conjunction with previous legislative measures dealing with the accurate mapping of broadband availability throughout the state by Internet service providers including state video franchise holders. This bill builds on the efforts of SB 28 and AB 2752 to ensure the PUC has the tools necessary to hold franchise holders accountable. There's been a lot of misinformation surrounding the amendments produced by the committee on this bill. I would like to begin by stating this bill does not impact the work of my dear friend and colleague, Senator Caballero on SB 28. This bill strengthens the efforts of the state legislature by restating granular level data, which means home addresses, to accurately identify unserved and underserved households in the state. DEVFA was passed to encourage competition in the cable market with the intent of benefiting consumers by lowering prices and promoting the expansion of services that include cable, phone and high-speed Internet access. 17 years later, it is clear that this approach, self-regulation of the industry through competition has failed. AB 41 is the California Legislator's attempt to fix what isn't working to ensure Californians have equal access to infrastructure necessary to stay connected with me. To testify and support are Meron Agonafer on behalf of the California Black Health Network. I respectfully ask for your aye vote when you have a quorum.

Thank you. You have two minutes. Thank you.

Yes, sir. Good afternoon, Chairman and members of the committee. My name is Meron Agonafer. I'm the policy and legislative affairs manager at California Black Health Network. I am here to support AB 41, which strengthens anti-discrimination laws by requiring cable operators or video service providers to offer equal access to subscribers within the service areas. COVID-19 has shown us that digital divide's detrimental effects that disproportionately affect Black individuals and families. When the COVID-19 pandemic forced schools to transition to remote learning, the lack of reliable internet access prevented many black students from fully participating in the online classes, accessing educational resources or completing assignments. This digital divide threatens to widen the achievement gap and extend systemic disparities. In today's society, access to reliable internet is essential, serving as a gateway to education, economic opportunities, healthcare and civic engagement. Without reliable internet access, Black individuals cannot fully compete in the job market, further limiting the economic growth and worsening income inequality. Without it, Black would also be denied the benefit of telehealth services. Exasperating health disparities. According to the 2020 American Community Survey, only 83% of black households in California have broadband. The rate is even lower for those with income less than 50,000. Closing this gap will allow blacks to participate in over 86% of jobs by 2045, according to the 2020 Dodge Bank report, which will benefit block and the overall economic development of California. I urge this committee to vote aye on AB 41. Thank you for your time.

Thank you. Any additional witnesses here in room 1200 in support of AB 41? State your name and your organization, please.

Good afternoon, Chair and members. Sasha Horwitz, Los Angeles Unified School District, in support.

Thank you. Any additional witnesses in support? Seeing none. Now, let's move to opposition. Are there witnesses in opposition? Are you the primary witness in opposition? You have two minutes.

Good afternoon, Mr. Chair and members. Amanda Gualderama with Cal Broadband. While we sincerely appreciate the committee's work on the proposed amendments, and we recognize that the amendments take this bill in a workable direction, they do not fully alleviate our concerns with the bill. We agree with the committee's analysis and most of the amendments taken with regard to the application and renewal process. However, we continue to oppose the author's edition in Section 5840 that would give the CPUC the ability to impose unspecified terms on the franchise holder, including upgrades. Federal law prohibits franchise authorities from dictating technology choices by cable operators, and this provision could establish a predicate for terms requiring infrastructure buildout. We also appreciate the committee amendments that address some of our concerns regarding updates to the anti-discrimination section of this bill. The bill with the amendments now includes a requirement to provide equal access to video service within a franchise, regardless of income. The language strips existing safe harbors, but fails to update the remaining language. The language states that the CPUC only needs to consider factors that are completely outside a company's control. For example, if an apartment building owner has an exclusive arrangement with a competitor, another franchise holder would be unable to provide access to that building. There should be certainty in these kinds of scenarios that a franchise holder will not be found in violation of the new equal access standard. Also, there are additional factors that should be expressly stated where there would need to be... for example, where there would need to be deploy infrastructure through a military facility or enterprise customer, and where the cost to provide video service is substantially above the average cost within that area. Both of these are not within the control of the franchise holder and should be added to this section. The last provision that I will highlight is in regards to how a franchise holder's fees are calculated. A franchise holder must pay local entities a franchise fee based on gross revenues derived from video services. Current law states that if an entity such as a public school is receiving video services for free, the imputed revenue is not included in the calculation for gross revenue. AB 41 omits this section, meaning the revenue that is never realized for the free service will be calculated into the reported income. This disincentivizes companies from offering these free services to institutions who rely on these services. We've requested that the language be restored to current law. Again, we appreciate the work the committee has done regarding this bill and the amendments, but Cal Broadband must remain opposed to AB 41 until the issues that we've outlined to the author and to the Committee in writing have been addressed in a workable manner. Thank you.

Thank you. Next witness, please. State your name and your organization.

My name is Shayna Englin. I'm here on behalf of the California Community Foundation Digital Equity Initiative, as well as the two coalitions we co-lead, the statewide California Alliance for Digital Equity, or CADE, and the Digital Equity LA Coalition, based in LA County. Both coalitions consist of cross-sectoral equity and justice organizations serving communities all across California as advocates and as direct service providers. And together, these two coalitions represent 40 of the 50 organizations listed in support of the bill and the committee analysis. We first want to sincerely thank Assemblymember Holden and personally, I'm your constituent. So thank you for being our champion to this point and working closely with us for the last nearly 18 months to continue the work that Senator Caballero began with Fenbrille 28 to bring necessary and overdue reforms to California's regressive franchise law. As co-sponsors, we've worked tirelessly in support of this bill, including participating in myriad negotiations and compromises to meet the concerns raised by the cable industry while ensuring we were faithfully representing the communities we serve. I think we all agree, after nearly two decades, we have clear evidence that DEVFA has met none of its stated goals and has, in fact, worsened access and affordability for services. AB 41 like AB 2748 before it and Senate Bill 28 sought to make reforms to bring better balance to California's approach to franchising and establish reasonable and common sense baseline protections to the vast majority of California communities that have no choice for service other than a franchise holder operating as a monopoly. Or at best, two franchise holders operating as a duopoly. Notably, the projections sought would merely bring California franchise requirements up to par, or maybe close to it in hundreds, if not thousands, of other jurisdictions around the country where these same companies operate profitably and continuously, and protections that are well within federal limits. Basic protections for Californians equal access, meaningful anti-discrimination community and local government input, basic service quality, and customer service standards. None of these are unreasonable. None would be unique to California, and none would prevent franchise holders from operating profitably. Again, as evidence that these companies continue to report profit margins of 30% or higher on these services at the same time as they operate, with these protections in place in most of the states and jurisdictions they serve, and as a baseline matter.

I'm going to ask you to conclude your testimonies.

So, regrettably, we are California Community Foundation, along with our other co-sponsors, is pulling off as co-sponsors and very regretfully, moving to oppose and urgent no vote on this today in the committee.

Thank you. Just state your name and your organization, please.

Oracio Gonzalez on behalf of NextGen California, also a former co-sponsor, now in strong opposition of the bill.

Tracy Rosenberg with Media Alliance. Also co-sponsors. Now we are forced to speak in opposition to the bill.

Ignacio Hernandez, on behalf of TURN. Based on the amendments taken today, we are now in opposition to the bill.

Thank you. Next witness.

Yolanda Benson with US Telecom, the Broadband Association, continuing to be opposed.

Thank you. Okay, any other witnesses here in the room in opposition? Seeing none. Consultant, let's establish a quorum.

Bradford. Bradford, here. Dahle. Ashby. Ashby, here. Becker. Becker, here. Caballero. Dodd. Durazo. Durazo, here. Eggman. Eggman, here. Gonzalez. Grove. Grove, here. McGuire. Min. Min, here. Newman. Rubio. Present. Rubio, present. Seyarto. Skinner. Stern. Stern, here. Wilk. Present. Wilk, present.

Members, a quorum has been established. Now we'll return back to the hearing seeing no additional witnesses in opposition, let's go to our phone lines. For witnesses in support or in opposition of AB 41.

Ladies and gentlemen, if you wish to make a comment in support or opposition, please press one, then zero. We'll be going to line 44. Please go ahead.

Good afternoon, this is Jenny Trice on behalf of the County of Santa Clara in support of AB 41. Thank you.

Once again, if you wish to make a comment in support or opposition, please press one and zero. We do have several that have just queued up one moment while their line number is given.

Hello, my name is... I am calling in opposition to AB 41. I represent United Parents and Students and a part of the Digital Equity Los Angeles coalition. Thank you.

Thank you. Next witness.

We'll go to line 10. Please go ahead.

Good afternoon, Chair and members. My name is Erika Cervantes, policy and advocacy manager with Alliance for Better Community. We are a Latino policy and advocacy organization in LA focused on education, health, economic prosperity and civic engagement. The amendments introduced for AB 41, unfortunately, are against many of the items that we advocate for on behalf of the Digital Equity LA Coalition. And I am calling today in opposition of AB 41 and respectfully ask the members to do the same today. Thank you.

Thank you. Next caller.

Next we'll go to line 26. Please go ahead.

My name is Sandy Mendoza with Families in Schools. We are dedicated to building the capacity of thousands of low-income families and families of color in Los Angeles to advocate for quality education and to close equity gaps impacting their children. We too are proud members of the Digital Equity LA Coalition and strongly oppose AB 41 as amended. Thank you.

Next we'll go to line 15. Please go ahead.

Good afternoon. This is Maddie Ribble with the Children's Partnership. We work to advance health, equity and racial justice for California's children. And we are regretfully opposed to the bill as currently amended. Thank you.

Next we go to line 17. Please go ahead.

Good afternoon. My name is Hannah Gravette with Innovate Public Schools. At Innovate, we work in partnership with low-income Black and Latino parents to powerfully advocate for high-quality public schools in their communities. Digital equity and access to education now go hand in hand, which is why we are in opposition of AB 41 as amended. In its current form, we feel like we're taking a step away from digital equity, therefore taking us away from equitable access to education. Please, I respectfully ask that you join me and the rest of the Digital Equity LA Coalition in opposing AB 41 as amended. Thank you.

Next, we'll go to line 11. Please go ahead.

Hi, my name is Ray Lopez-Chang calling from GPSN, where we convene over 70 cross-sector Los Angeles organizations to improve public education for underserved students. We are disappointingly now in strong opposition to AB 41 as amended, and proud Members of the Digital Equity LA Coalition.

And there's currently no one else in the queue, Mr. Chair.

Thank you. We'll bring discussion back to the committee. Are there questions or concerns by committee members as it relates to AB 41? Senator Eggman.

Thank you. Find ourselves in a funny situation here, Mr. Holden. And I understand that you took the amendments that the chair asked you to take, the committee asked you to take, and now you find yourself in this situation. Can you talk through a little bit like, what's our plan going? What's our plan here?

Well, I guess all I can say is that my goal is to move something that was meaningful. And if I felt like what the committee was recommending with these amendments were not meaningful in terms of creating community engagement, public hearings where city councils can come forward and say, look, we want to make sure as the PUC goes through this process that we have an opportunity to make sure that our disadvantaged communities are going to have an opportunity to have their voices heard through this renewal process. That wasn't in there. That would be one reason why I may not support it. If there wasn't an opportunity to have the PUC further look at the issues of discrimination and to be able to then have as a factor expanding the market and build out, then I probably would say that. And then you've heard from the opponents, who were the opponents consistently through this that said that they didn't like that. So it is an odd place to be because I do think it moves the ball forward. Last year we had a bill that was similar to what was presented and had made its way to this committee, and it was held in committee. And so my goal is to move legislative... I mean, this is not the first bill that I didn't get everything I wanted. This is the first bill that I've ever had to have those who believed in the core values of what we're trying to do all of a sudden, I've had some say, well, I don't like an amendment, and so maybe I'll stay off, but never say I'm pulling off, and now I'm going to oppose it, send out email messages to the universe saying, you should tell Holden to make this a two-year bill. Why would I do that unless these other provisions were not included? So for me, it does make a difference. It moves it forward in a way that I think in future years, maybe the fullness of what was hoped for and expected could be evaluated. But as we stand here today, I think that given the PUC the opportunity to have the ability to look at discrimination elements, which is not the case now, to also have an opportunity to ensure that there's build out as a remedy that kind of gets to that issue if it's warranted. And so I respectfully ask for your aye vote. I wish it were different. I wish that there were those who appreciated what we were trying to accomplish and know that in this process doesn't always land perfectly.

Thank you, Mr. Holden. And I'll just say, I've known you for a long time and I'll make the motion to move this bill. I think you've done what the committee asked you to do, that you've been a fair player in this. Not saying anybody else hasn't been fair, but just saying you've been an honest broker in this. So I'll be supporting it today and then respect what other process you want to take going forward after this.

Appreciate it.

Any additional questions? Senator Min.

Thank you, Senator. I'm also kind of a little confused about where this bill lands, but I appreciate the answer. I had a different question, and this just speaks to my own lack of knowledge of the space, but does this bill also cover, like, Google Fiber or AT&T Fiber? Are those covered under a different regulatory scheme?

I think they're not included.

They will not be included in this. No, they will not be included. Just state video franchise.

Yeah. And so I guess here's my concern, which comes from a different place, which is I have a traditional cable service in my home in Orange County, and I pay like $200 a month for broadband, high speed broadband there. Here in Sacramento, I have at and AT&T fiber, and I pay far less than that. And my concern is that by creating affirmative obligations on the cable providers for broadband, but not on other providers, you're further tilting the playing field in favor of some of these other providers. And I know that AT&T Fiber and Google Fiber are kind of going into these high-income areas where there's high density of broadband usage. And I wonder if you could just speak to that concern.

Let me address your concern. I believe you're referring to the bill before it was amended and including the build-out principles. With that being said, this bill, based on the amendments that have been accepted, focused solely on video. And so with that being said, we understand that the same infrastructure that delivers video also delivers broadband. However, this is focused on how can we ensure that the PUC has the tools necessary to investigate when there's possible discrimination in those low-income communities for them to set their own benchmarks. So really just focus on cable franchises.

Got it. So when you say video, you mean like, what we think of as cable television?

Okay. Got it. All right. Thank you. That helps.

Yes.

Senator Durazo?

Yes. I'm kind of in a similar position that Senator Eggman is, and I'm sure you feel kind of... I don't know what the word, you say it, but it is really difficult because of your credibility, to not support you. On the other hand, what is so deeply wrong that supporters are now opposing? Maybe you don't answer that or you answer that and somebody else does, but I've never been in this situation before. Maybe you haven't either, but is there a damage that could come from this? I mean, it's one thing to not get everything we all go through that we all make changes when we don't want to make changes. But is there somewhere in here, like people are going to get hurt by it or we're going to get damaged by it so that it's not just a smaller step than what we would have wanted, but it's actually a step backward. Do you think that's the case here?

You hear the term often making the perfect enemy of the good. I don't want to speak for those who have been supporters. I know that they were looking for a righteous outcome. I was as well. I think this is I think it isn't a 10. It's maybe a six on a scale of one to 10. My assessment of it. That's why I'm moving forward. If I thought in any way, having public hearings, creating still avenues for access, trying to close the digital divide by including the PUC, to give greater focus on making sure these benchmarks are hit by these providers, I see it moving forward. They'll have to speak to what part of it is. If one more piece was in, would they be still on the bill or there was all of it? I can't speak for them. All I know is that when I put this bill forward, it was recognized, it's already had history in this process. This isn't the first time we brought a bill like this to this committee. Last year, we didn't get a hearing or it was going to have a hearing, but it was going to have just basically everything stripped out of it. I wasn't willing prepared to go forward with that. This year, I think through the chair and the committee, we were able to at least get some very important elements that were still going to be addressed, that needed to be addressed. Maybe not in the way that those who were former sponsors thought it should be, but the PUC has it as its discretion to be able to still look at ways to address the anti-discrimination piece and to make sure that there could be remedies that could go as far as causing the provider to do the build-out, which is in its own separate carve out piece. Part of what was hoped for that would be in the bill. I'm trying to present this in a way that... this will represent progress. Part of me would love to see it represent everything that we were trying to get, but it does not.

Senator Rubio.

Thank you, Mr. Chair. I mean, clearly we all find ourselves in the same circumstance. I think I heard LAUSD supporting it. Of course, as a teacher, I want to make sure that there's access for our students. But then at the same time, then I heard TURN oppose it. And so this is a really unusual predicament, and I'd like the opportunity to hear maybe I don't know if TURN is here or some others that were supporters and now are not, because that would give us a little bit more clarity as to where did this bill go wrong so we can hear that perspective. If you don't mind, sure.

So I think one thing just to put out there again is, as I said in our opening remarks, all of us, again, the 40 of the 50 organizations on the previous supporter list, plus TURN, have really appreciated being able to work with Assemblymember Holden on 2748 last year and then 41 this year. And in all of my years of doing this kind of work, I've never been in the situation. It is awkward and heartbreaking and horrific. So would just say that if you look at a line by line of where the bill, after many compromises and amendments to get to this committee, and then you look at the amendments that were then taken in this committee, it strips almost everything out as a starter. So I, Assemblymember Holden, respectfully disagree that it includes anything around build-out. It does include language that says equal access. It does include language that says anti-discrimination, although it strips any specifics of that out. It even strips the existing DEVFA specifics around anti-discrimination out, but it does not actually provide for any remedy for that. There is no build-out. Every single reference to build-out that was in this bill is gone. I don't see and it's possible that we're wrong, but these amendments came out so late that we have to kind of base our positioning and our thinking on all of the conversations with experts and everything that we can see in essentially the 24 hours we had to contemplate it. There is no build-out in this, specifically, the fine amounts. One of the other remedies could have been fine amounts. The fine amounts were reverted back to those set in 2006. They're so low so as to not be meaningful. And then, yes, we appreciate a public hearing, but then there is nothing around that public hearing, around what the CPUC can do with what they hear. So, yes, perhaps a city council or community members like the 40 who showed up at Inglewood City Hall last week could show up to a public hearing. But again, there's no remedy for anything that they bring up in that. And then additionally, as Senator Holden's staffer, who again we've worked tirelessly with for months, as she noted, one of the key things that has already been stripped out of this bill is an acknowledgment of the basic reality that cable and broadband are the same. So then these amendments go further and strip out anything that would actually still maintain a protection around the broadband pieces of cable franchises. So in our view, at very, very best, what this bill does now is the status quo, which is unacceptable. And we think but again, we'll freely acknowledge that we haven't had enough time and that we've heard at this point now multiple different interpretations of whether there's active harm, but at minimum, it makes no progress. And given that we're at 17 years now of DEVFA with only minor changes. Our concern is that the major harm is that if we move forward a bill that basically just cements DEVFA as is, we have lost our opportunity to do anything about it.

Thank you. Thank you for that explanation. It is really distressing to see, like, LAUSD on one side, and I think I heard 70 cross-sector equity digital equity organizations. And so it's a little distressing here, but I just I'll turn it over to the chair to conclude his questions and comments and give it some thought. Thank you.

Thank you. Senator Stern.

Thank you, Mr. Chair. Senator Rubio handled that well, I thought. Although I didn't know if there was a different opinion. You'd mentioned TURN as well, but I don't know if from a ratepayer perspective, but would it be all right just to respond to some of those issues they itemized? They're saying stripping out the key anti-discrimination provisions all build-out is gone. Maybe you could just kind of walk us through why you think, given the compressed period of time.

Sure. I think that they may have given you a glimpse into why they've taken a more aggressive position, because they have said that with limited period of time, maybe there's something they missed. Well, maybe there is. What I said in my opening statement guarantees a longer review process of franchise applications, including a public hearing, ensures low-income Californians will have equal access to video services and broadband-capable infrastructure. Allows the PUC to set anti-discrimination benchmarks. Set benchmarks to investigate any anti-discrimination violation. If a violation has occurred, the PUC can find a franchise holder, revoke their franchise or even require build-out as a remedy.

In regards to the reviewing of applications, the new ones, as well as the renewals, we can see currently that the PUC only has about 44 days to issue out the franchise. And so with the amendments that were offered by the Committee, it does extend it to 60 days to review that it's complete, and then 120 days to have a public hearing. So in all, 180 days to really have the public come and participate and look at what they're going to get from this franchise. So public participation has always been number one with this bill in addition to the anti-discrimination section. So in regards to the anti-discrimination section, in my conversations with the PUC, in addition to consultants, when it does come to proving a violation that does occur by franchise holders, the fact of the matter is the current benchmarks are so low that it's hard for them to prove that they are discriminating. The fact that we remove those and allow for the PUC to actually determine what does violations, anti-discrimination violations look like allows for them to actually go and use the data from SB 28, use the data from AB 2752 to see if there's areas in the state where franchise holders have not invested. And so with these amendments we believe that it is moving it forward. No, it's not getting the build-out explicitly, but that is something that could be a remedy if they're found in violation.

Thank you. Mr. Chair, I'm torn about this. I have a great deal of respect for you and obviously very good staff work here and also this committee staff, frankly. I'm going to support your bill today, but I need to reserve the ability to potentially reconsider that going forward as we digest this. If it seems like there's some sort of active risk of codifying this framework, that it could have a sort of detrimental effect, I want to take a second look at it. But based on that description, I think your argument makes some sense. So I'll be supporting today. Thank you.

Any additional questions or concerns by committees? It's been moved. Thank you. And let me weigh in here. And I want to first thank the author for your willingness to work with this committee. And I don't want to misspeak here, but I think Mr. Holden and myself, I don't know if anyone was local elected officials 17 years ago when DEVFA was passed. It's this legislative body, not the members who are assembled here today, that created this problem that we're trying to address today. It was the legislature 17 years ago that created difficult. Up until then, local jurisdictions hit the right to negotiate those franchises and ask for all those things that we want in this bill today. What we have done here today is move us closer to where we were 17 years ago. Is it perfect? No. But please understand that this committee has no direct say on federal issues, which broadband is federally regulated, whereas cable, we have say in that. PUC has say in that. And again, prior to passing of DEVFA, we could negotiate with those local cable providers to say what we wanted in our communities. And many of these communities used to have something that doesn't exist anymore. PEG channels. Most cities had their own public education channels. They had plenty of them to do a variety of programs where youth were involved. Those are all gone away because of DEVFA. What Mr. Holden is trying to do with the assistance of this committee is to move back and put some of these pieces back in. And I'm a firm believer that we shouldn't let the perfect be the enemy of the good. And this is where we find ourselves today. It's a lot of good work here. Is it bringing us back to 17 years ago where we had to say, no because there are more federal constraints that tells us what we can and cannot do. And we're trying to pierce that and walk that fine line. And this is what this bill does, and I think Mr. Holden has been more than willing to he wouldn't be standing here today accepting these amendments if we were moving backwards. This is progress, folks. Is it what we started or what Mr. Holden started with at the beginning of introducing AB 41? No, it's not. But it's far farther than what we have and what we've had over the last 17 years. So that I will allow you to close.

Respectfully ask for your aye vote.

Okay, and we have a due pass, as amended, to the Judiciary Committee. And I'll just go on record and just say, I understand the committee's proposed amendments will not satisfy all the stakeholders, as we heard, but however, again, I think we've made great progress in where we were 17 years ago and where we're trying to get today. With these amendments, this bill takes an important step forward in addressing digital equity by removing existing barriers to pursuing digital discrimination and preventing issues of federal preemption. Specifically, I note that with the amendments, this bill establishes a new, more enforceable, higher anti-discrimination standard of providing equal access to consumers regardless of their income. This bill also provides groups more opportunity to bring concerns to the CPUC during franchise renewals and removes administrative barriers to investigating cases of potential discrimination. I understand the author will continue to work with the stakeholders as this bill moves forward and the following amendments are included remove references to terms related to broadband services from the bill's definition of equal access. Delete the bill's anti-discrimination safe harbors. Remove franchise build-out requirements. Delete modifications to the state and local fines. Clarifies renewable applications or renewal timelines to extend existing applications. Review timelines of 180 days as the consultant clearly stated, and permit the PUC to hold those hearings on renewals and reinstate provisions of existing law that support collection of household broadband access data and make other technical changes and conforming with those changes. I should say so. We have a motion due pass the Judiciary Consultant. Please call the roll.

Bradford. Bradford, aye. Dahle. Ashby. Ashby, aye. Becker. Caballero Dodd. Durazo. Durazo, aye. Eggman. Eggman, aye. Gonzalez. Grove. Grove, aye. McGuire. Min. Min, aye. Newman. Rubio. Rubio, aye. Seyarto. Skinner. Stern. Stern, aye. Wilk. No. Wilk, no.

Eight to one, that Bill has eight votes aye, one no. We'll leave the roll open for absent Members. Thank you, Mr. Holden, for your patience and your presentation. Next, we move to Assemblymember Haney. He's here. File item two, AB 593. When you're ready, you may present.

Thank you, Mr. Chair and Members, I first want to accept the Committee's proposed amendments, and I want to thank you and your staff for working with us on that language. AB 593 directs the California Energy Commission to identify and implement an emissions reduction strategy for the building sector, complete with emission reduction milestones to advance California's path to carbon neutrality by 2045. In California, commercial and residential buildings account for approximately 25% of the state's greenhouse gas emissions, second only to the transportation sector.

In addition to contributing to climate change and its impacts, building emissions also contribute to indoor and outdoor air pollution that disproportionately harms the health and well being of Low income and communities of color. While the state has made an effort to create policy and Fund pathways that would reduce emissions from buildings, it has not implemented an overarching strategy to actually reduce building emissions. We now need a comprehensive statewide building emission reduction plan that helps the state reach its carbon neutrality goals.

AB 593 would be the next step to build on existing efforts because it requires the state to take action on their findings related to building greenhouse gas emissions. It also requires the CEC to prioritize high road workforce development, send clear market signals to appliance manufacturers, and installers lessen impacts on ratepayers, support climate goals, and address barriers for Low income communities.

Here to testify with me in support is Jose Torres, California Director of the Building Decarb Coalition, and Kiki Velez equitable Gas, transition advocate at NRDC.

Thank you. You each have two minutes. You may begin.

Good afternoon, Chair Bradford and Members of the Committee. Thank you for the opportunity to testify in support of AB 593. I'm Jose Torres with the Bill and Decarb Coalition. We're the sponsors of the Bill. The Bill and Decarb Coalition is made up of manufacturers, energy providers, local governments, and environmental NGOs, all working together to advance pollution free homes, workplaces and communities.

And given, as you heard, that billing account for the quarter of the state's emissions, we believe this is one of the most cost effective solutions for taking on climate change. Not only does it take on climate change, it's also one of the few technologies and approaches that also provides direct benefits to rapepayers and others through climate adaptations, such as heat pumps, which provide air conditioning to homes, and other approaches that we think are critical both to the survival and progress when it comes to climate change.

Additionally, the state as a whole has taken this approach right through various ways. Where there's 75 jurisdictions representing over 28% of the state's population that have passed their zero emission Building Codes, the CEC has also passed their 2023 building code with zero emission space and water heaters as the baseline standard for new construction. The state's largest affordable housing program, the Affordable Housing and Sustainable Communities Program, now requires all electric, new construction, and a variety of other policies.

That's why we think that developing this comprehensive strategy for zero emission buildings will ensure that our transition to the future is thoughtful and strategic. And we think this Bill will allow us to focus on protecting the most vulnerable, focusing on energy affordability, workforce development, and climate resiliency, as the Assembly Member shared.

So we think with this Bill, we can create a plan that doesn't only allow us to hit these targets right, the targets that have been put forth last year when it comes to 2045 carbon neutrality. But it also allows us to take an essential next step and puts the Energy Commission and other agencies in a leadership role. I want to thank Assembly Member Haney for his leadership in authoring this Bill and thank you for your time. I'm happy to help answer any questions the Committee may have, and we look forward to working on any outstanding issues. Thank you.

Thank you. Next witness.

Good afternoon, chair Bradford and Members of the Committee. My name is Kiki Velez, and I'm a clean buildings advocate at the Natural Resources Defense Council. As Jose shared, California cannot meet its climate targets or provide healthy, safe and affordable housing without quickly cutting emissions from the state's buildings. In addition to climate benefits, creating a plan to decarbonize our building sector will also offer critical clean air and resiliency co-benefits.

Today, more than half of all Californians live in areas with unsafe levels of ozone pollution, as do 99% of all disadvantaged communities in the state. And buildings are responsible for roughly two thirds as much NOx pollution as the state's 16 million passenger vehicles. Decarbonizing the state's building sector provides direct benefits to Low income and disadvantaged communities that are disproportionately burdened by indoor and outdoor building emissions and their negative health impacts, which include asthma and other illnesses.

Additionally, heat pumps, the state's current zero Emission appliance option, offers both heating and cooling potential. This is critically important for those at the front lines of climate change and extreme heat events. So, as we retrofit homes with zero emission heat pumps, we are also supplying the roughly 25% of California homes without air conditioning with an extremely efficient and critical tool to address increasing extreme heat.

In light of these co benefits, the federal government and the State of California have made critical investments through the Inflation Reduction Act and the Equitable Building Decarbonization programs. But to strategically utilize that federal funding and state funding, and to maximize benefits for equity communities, we need the state to create targets and develop a roadmap for equitable building decarbonization.

As California makes this transition, it's central that we do so in an organized manner that minimizes costs, increases grid resiliency, protects ratepayers, provides market certainty for customers, and creates good paying jobs. AB 593 will enable that comprehensive planning that we need to ensure that California meets its climate targets while delivering health and resiliency benefits of building decarb to all of California. Thank you.

Thank you. Any additional witnesses in support? State your name and your organization, please.

Good afternoon, chair and Members. Andrew Kosydar with Southern California Edison in support.

Fatima Iqbal-Zubair with California environmental voters in strong support of AB 593.

Amara Eger on behalf of carbon free Palo Alto, carbon free Silicon Valley and Spur in support.

Lillian Marvis with MCE, California's first community choice aggregator, here in support. Thank you.

Priscilla Quiroz here on behalf of Advanced Energy United and stop waste in support.

Katherine Brandenburg on behalf of Sonoma clean power in support.

Silvio Ferrari on. Behalf of Rewiring America. In support.

Thank you. Any additional witnesses here in the room in support? Seeing none. Now let's go to opposition. Are there witnesses here wishing to testify in opposition to AB 593? Seeing none. Moderator let's go to our phone lines for individuals wishing to testify in support or in opposition of AB 593.

Of course. Ladies and gentlemen, if you wish to make a comment in support or opposition, please press one, then zero. We'll be going to line 51. Please go ahead.

This is Gabriella with the Sierra California calling in support.

And there's currently no one else in the queue at this time, Mr. Chair.

Thank you. We'll bring it back to the Committee. Any questions or concerns by Committee Members?

Senator Becker yeah, I just want to thank the Assembly Member for his work on this Bill. Buildings are really important. I have a Bill just presented on large buildings very complementary to this, but I think that's about 20 million metric tons just from buildings over 50,000. Appreciate this will help us plan and develop a comprehensive strategy and look forward to moving the Bill when appropriate. Now I'll move the Bill.

Bill has been moved. Any additional questions or comments? Senator Derazzo?

Thank you, Mr. Chair. I also appreciate the very many issues that you want the strategy to include. So I look forward to what the actual strategy is going to be and how do we make sure that we put real teeth to the incentives that will be provided so that they really are good jobs, not a promise of good jobs or the barriers for Low income individuals. So with that, I look forward to see the result.

Thank you. Me too.

Thank you. Any further questions or concerns? Hearing saying none. The Bill has been moved. We have a due pass as amended to the Committee on Appropriations. Senator Member, would you like to close?

Respectfully. Ashby aye vote. Thank you.

Thank you. Consultant please call the roll on AB 593.

Bradford.

Aye.

Bradford. Aye. Dahle.

Dahle. No. Ashby. Becker.

No.

Aye.

Becker. Aye. Caballero. Dodd. Durazo.

Aye.

Durazo. Aye. Eggman. Gonzalez.

Aye.

Gonzalez aye. Grove. Grove. No. Mcguire. Min. Newman. Rubio.

Aye.

Rubio aye. Seyarto.

Seyarto no. Skinner. Stern.

No.

Aye.

Stern, aye. Wilk.

Wilk, aye. Seven to three.

Aye.

Thank you.

The current vote is seven to three. We'll leave the roll open for absent Members to add on. Next up is Assembly Member Lee with AB 604.

Thank you. Chair and Senators. First, I would like to accept the Committee's suggested amendments on page seven analysis to delete section three of the Bill. This is a follow up to my Bill from last legislative session, AB 1061, which was signed into law current current law prohibits mobile home park management from charging tenants for their sub metered water service beyond charges paid by management directly to the water services provider at a reasonable administrative and a reasonable administrative fee.

Unfortunately, park owner affiliate organizations have argued that certain mobile home parks are exempted from the statute as written. In response AB. 604. This Bill clarifies the scope of existing law. Its caps on water service charge fees apply to all mobile home park residents. These charges may include nebulous charges, such as customer charges or service charges that far exceed the charges billed to the park by the serving water utility.

With that, I'd like to have my support witness testify, which is Roger Johnson from a mobile home park resident.

You have two minutes.

Good afternoon. My name is Roger Johnson. On behalf of GSMOL in Support. It was only two years ago mobile home residents were before the same Legislature on this very same issue. Both the Legislature and the Governor agreed that with us that mobile home residents should pay for the water we consume and our pro rata share of service fees that water companies Bill to our park owners.

The Legislature also agreed that when water is submetered, park owners should not be allowed to mark up the price of water and make an unfair profit. But even as Assembly Member Lee's legislation passed and was signed into law, many park owners continue to make up their own fees and charges. AB 604 will clarify what is legal and what is illegal for park owners to charge. We ask for your consideration. Thank you.

Thank you. Any additional witnesses and support here in the room? If so, state your name and your organization.

Gary Kenny, I'm a mobile homeowner in Citrus Heights and I support the Bill.

Thank you. Next witness.

Good afternoon. Michelle Moning, I'm the HOA President at a mobile home park in Roseville, in full support.

Thank you.

Joanne Lewis mobile homeowner in Citrus Heights. And I'm in full support.

Thank you.

Paul Moning mobile homeowner. Roseville. Support.

Thank you. Any additional witnesses here in room 1200 in support of this measure? And seeing none, let's move to opposition. Witnesses in opposition. If you're the primary witness in opposition, you'll have two minutes.

Yes, thank you. Mr. Chair, Members, Senators, on behalf of WMA, my name is Chris Wysocki, and we respectfully have to oppose 604. Today WMA, we represent about 1600 parks around the state, and we agree with the author that water is something that we shouldn't be profiting from. That's why we believe park residents should be directly served by the local water agency. Water submeters help conserve water by holding residents responsible for the amount of water that they consume.

Unfortunately, the way AB 1061 was written and passed, this Bill also will force owners to go to a pro rata billing system, which will discourage water conservation. The Committee analysis correctly noted that the fee allowed under 1061, and this AB 604 was based on a 2017 Bill authored by Senator Lois Woke that applied only to apartment communities. Mobile home parks spread laterally. Apartment communities often go vertical. It's much more difficult to maintain a water system in a mobile home park than in an apartment community.

SB Seven allowed for a water collection fee of 475 a month, and that was adopted in 2017, but it allowed for CPI adjustment. This Bill retracts that 475 and starts the clock. Anew submeter reading and maintenance often cost park owners well in excess of this fee. And this forces us to lose money on water delivery. To allow submetering, we actually believe that we should be allowed to charge just what the local residents that are not in mobile home parks are charged for water delivery.

Failing to take the amendments that we've offered will simply allow us to switch to a pro rata billing system. And that means a single resident will be spending the same amount as a family of four living right next door. How does that encourage water conservation? Finally, WMA believes the best situation allowed to us would be to get us out of the water business altogether. We don't believe we should be in the water business.

We don't want to make money, but we don't want to lose money collecting water. And for these reasons and others, we respectfully oppose. And to the author of the Bill, what better birthday gift for tomorrow than for us to oppose your Bill?

Thank you.

Thank you very much.

Thank you. Any other witnesses here in room 12 on your wishing to testify in opposition? Seeing none. Moderator let's go to our phone lines for witnesses in support or in opposition of AB 604.

Thank you. Ladies and gentlemen, if you wish to speak in support or opposition, please press 1 and 0. And first we have line number 19. Just a moment. Line number 19, go ahead.

Good afternoon, Josh Gauger on behalf of the Santa Cruz County Board of Supervisors in support. Thank you.

And that is all we have in queue right now.

All right, let's bring the discussion back to the Committee. Are there questions or concerns in regards to this measure, Senator Wilk?

Yeah, the opponent's arguments seem logical to me. Taking their amendments, would, one, conserve water, and two, actually have a fair distribution. Because if you're a single person and then you're going to end up paying the same as four people, how did that not come together?

Yeah, thank you for the question, Senator Wilk. I mean, the purpose of this Bill is to clarify existing laws. You pass it today, I'll get into a little bit again to why we need to clarify existing law today.

What the opposition is proposing is, I would feel, much more like a different Bill altogether. I understand some parks want to get out of the water biz altogether. There was a proposed Bill this session too, that didn't make it as far, but that would be kind of a different topic altogether. This is really clarifying what is an existing law today. I'll give you one example from my hometown of San Jose. So existing law right now says that the administrative fee is capped at $4.75. Right.

This park is still charging $41.71 in service charge. That's 3696 more than allowable, supposedly. But because right now there's a difference of interpretation. There are people right now who are paying way more in administrative fees than they ought to. And we know especially that in mobile home parks, these are some of our last vestiges of affordable housing, especially for seniors on fixed incomes. Right.

And so when you're being charged way more than the law should be allowing to that, I think it's a big, urgent clarification need. So to that question, this is about a very specific issue about these fees and charges about restructuring and who should provide water, I think is a slightly different issue, which I know we've kind of and the opposition I've talked about is a different piece of legislation perhaps in the future.

Okay, so I get that respect that, if they're out of compliance with the law, aren't there other remedies for mobile home park owners to pursue? It's supposed to be 475 and it's $41.

Well, this is why we want to make it crystal clear in law not have to have these mobile home park residents or park by park go pursue different mitigate.

In a follow up to that yes. Is that I believe, again, the opposition said that it was the original legislation, I think 217. He said 2017, 4.75 and then CPI after that. And if I heard it correctly, you're going back to zero or just back to 4.75?

So last year's Bill AB 1061, that was the Bill that I authored and was signed in law that was loosely similarly based on the Wolk Bill from years ago.

So what's the new administrative fee? I'm unclear on that.

So I believe the new cap on it is 4.75, if I'm getting that right.

But missing out on the CPI through all those years.

I have to get back to you on that one. All right.

Thank you, Senator Grove.

Thank you, Mr. Chair. I did want to clarify so we're not going back to zero, we're going back to 475, which is, you said, currently allowed under the law.

Yes.

And then when you said 4.75 and then some people are paying 41, is that per day, per month, per gallon?

Per I believe this would be per month per month on your monthly billing with a Bill.

And it's an admin fee. Yes. Sorry, go ahead.

I was just going to say, what this Bill seeks the heart at is to mitigate what often appears when you go mobile home park residents when they go look at their water Bill. It could be show up as a service charge, administrative charge, whatever it is. That's on top of your usage fee. Right. Normally if I use a bunch of water, then I pay for that on whatever gallon basis it is on a monthly Bill. Right.

But then there's also these extra charges that show up on here. What this Bill is doing is to clarify the law that we did pass to say that it should be capped, that you shouldn't be making more extra money on top of someone's usage.

So just to clarify what the opposition said, and I'd like your response on it, if possible, the comment was that a person that was single would pay as much as somebody with four Members in their family. That was a comment that it would be the same. I guess my question is, if you're charged on usage plus a $4.75 fee, how does that work out? Because obviously the family of four would use more water than the single person.

Right. I'd have to get back to you on this hypothetical issue. But the thing is, what we're trying to do is limit the amount that this fee would right? So whether it's a mobile home park family of one or four, the fee is capped. Your usage payment will depend on your usage payment. Right? I mean, if one person uses more water than four people, that's the case. But the water Bill should still stay overall based on your usage. Still.

So that's what I'm trying to get at. So if a family of four uses 100 gallons per se and a single person uses 20, technically that single person's Bill would not be more than the family of four.

Okay. I just want to make sure.

No.

Yeah, I don't think I agree with that hypothetical math of the usage.

Okay, thank you.

Thank you, Senator Becker.

Thank you for working on this. I just did have a question. We want to encourage submetering. So is there a concern if the prices had too Low that it would discourage submetering? I felt like that's one of the things I heard. Or do you still feel like this is sufficient to encourage submetering?

I don't believe so, but I can get back to you on that with more detailed response if necessary, Senator.

Any other questions or concerns by Members. All right, do we have a motion? We have a motion by Senator Gonzalez. We have a do pass as amended to the Committee on Appropriations. Assembly Member Lee, would you like to...

Ah, the amendments remove changes to the Public Utilities Code Section 275.6, section three of the Bill as this section pertains to water service for supply and facilities owned by the mobile park and not master metered arrangements subject to civil Code 79 8.40, where the park owner receives service from a water provider.

So as somebody who's a couple of years away from being on fixed income, I'm very much sensitive to this.

If it was 4.75 plus the CPI since 2017, particularly since we've had inflationary times, I would be able to support that because I don't think bad actors should get away with that. So I understand what the author is doing. I'm not going to be able to vote for the Bill today, and that's frustrating because it's the right thing to do. But I think it's also fair that people who are legitimately following the law now, they're going to get penalized because of some bad actors.

Just to clarify, Mr. Chair, there's not including CPI in that that 4.75 will stay into perpetuity. Is that correct?

I don't have my notes in front of me.

Assembly Member Lee. Is that correct?

I am also taking a look. I don't want to give you the wrong answer.

It's okay. I mean, I'm not trying to delay the Committee, but I would support it if it included CPI office when you'll get inflation, if it's going to stay at 4.75 into perpetuity, I think that's unjust punishment to the mobile homeowners themselves. Because if they have a water increase, if gas goes up and transportation costs go up, they should be able to do a CPI index. But I was just here maybe. Sorry.

I'm so sorry. So, just to clarify for your question, there is no CPI in it.

Assembly Member Lee, would you like to close?

Respectfully, ask your aye vote to clarify this and help protect our seniors in mobile home parks.

Thank you. We have a motion by Senator Gonzalez and we have a due pass as amended to the Committee on Appropriations Consultant. Please call the roll on AB 604.

Bradford aye. Dahle no. Ashby. Becker aye. Caballero. Dodd. Durazo aye Eggman. Gonzalez aye. Grove aye. Mcguire. Min. Newman. Rubio. Seyarto no. Skinner. Stern. Wilk. Five to two.

Current vote's, five to two. We'll leave the roll open for absent Members to add on. Next up is file item four. AB. 662 by Assembly Member Boerner. She's prepared. You may begin when ready.

Yes.

Good afternoon, chair and Members. I want to begin by accepting the Committee's amendments. AB 662 is a Tasha B special. Some of you have been in committees where you've seen other Tasha B specials. My consultant, Emilio Perez, and I wrote this together. Given the challenges that we've been observing with the PUC's Administration of Federal Broadband Dollars to Date, and we have worked with advocates and Committee consultants and the industry alike to arrive at the Bill in front of you today as amended.

AB. 662 would require the California Public Utilities Commission to strictly follow federal guidelines established by the federal government while implementing the federal Broadband Equity Access and Deployment Bead program. As you know, Bead is a $1.86 billion broadband infrastructure program being implemented by the PUC pursuant to the Federal Infrastructure Investment and Jobs Act. While the additional funding is certainly great news for California's efforts to close the digital divide, there are reasons that we should all be concerned about the CPUC's ability to effectively administer these funds.

My concern about what lies ahead is why I'm carrying this legislation with two specific goals in mind first, to ensure that the Legislature has a real voice in implementing the process of this very large sum of funding. And secondly, to ensure that we do not repeat the mistakes of the recent past with a federal funding account. To this first point, without legislations, we as Members have limited number of tools available moving forward to hold the CPUC accountable when implementing the bid program.

As chair of the Assembly Communications Conveyance Committee, we have held oversight hearings, we have submitted letters, we've done sign on letters, we've done all those things, and we're seeing very little movement in what is really important to close the digital divide. And you might know this, but because Bead is a federal program, there are almost no requirements to meaningfully consult with the budget or policy committees unless we insist on this in advance.

As the Committee analysis points out, the CPUC will be required to share the plans with the Legislature within 10 days of submitting their plans to the federal government. But that doesn't provide us any time to take our feedback and seriously consider our concerns. The Administration of the CPUC objected to any more stringent requirements, which suggest that they're not interested in collaboration with any of us.

Instead of being reactive, the approach I'm asking for you to support today is to be proactive about the direction of these funds and to ensure the Legislature remains engaged to the second goal on avoiding past mistakes. I'm reminded of all the issues that arose during the implementation of the Federal funding account. Ask yourselves how many of you heard from stakeholders when the CPUC issued their first proposed decision on their program rules for the FFA back in April 2022? That's a year and a half ago.

Just a few months ago, we're in the same position when stakeholders were up in arms about the CPUC's priority area maps. The CPUC has barely started accepting applications for that funding after two years of delay, and they won't begin awarding the first grants until the end of the year. That delay is unacceptable. Their priority maps and underlying criteria were not required by statute.

It's just another example of the CPUC going above and beyond what was reasonable or necessary, which in the end has caused significant delay and jeopardizes those federal dollars getting out to the people who need it in California. We can't afford to repeat this mistake of the past, and we must hold the CPUC to basic standards as they move forward to hopefully make the Bead program a success. That is, I think, our common goal and the success of the Bead program.

But in order to get there, I believe that Legislature needs to remain engaged. Lastly, to the Committee amendments, I want to express my intent to continue working with the Committee to clean up on some of the drafting the Committee amendments in a manner that's consistent on what we're voting on today. For example, the definition of Low income household and Low cost broadband option will remain in the Bill despite the Committee amendments striking these sections where those definitions are relevant.

And we should be resolving these issues additionally on the authority of the CPUC to prioritize applicants that commit to addressing affordability. I'm reading the intent of those amendments as supporting of prioritizing affordability, but the language could be more clear and direct if that is our true intent. With that in mind, I'll turn it back to Chair Bradford and I welcome any questions, because as the TBH special, we have no witnesses. It's just me and my consultant if I need some help.

So, are there no witnesses in the room in support of this measure hearing and seeing none witnesses in opposition. State your name and your organization.

Good afternoon, Chair Bradford and Members of the Committee. I'm from Chris Ungson from the Public Advocates Office. While we appreciate the proposed amendments we received on July 7 that preserve the CPUC's authority to require meaningful affordability plans for both Low income and middle class families, concerns remain. By prohibiting the CPUC from adopting rules not explicitly required by the federal rules, the Bill limits the CPUC's ability to tailor the program to Californians' needs.

For example, this provision could prevent the CPUC from adopting any incentives regarding efficient use of the state middle mile project. This provision also could delay the distribution of federal funds because of potential litigation over what is explicitly required. Because of these concerns, we believe this Bill should not move forward unless it is further amended to remove this provision. Thank you.

Thank you. Next witness.

Good afternoon, Mr. Chair, Members, Ignacio Hernandez. On behalf of Turn, we echo the same concerns as the prior witness. Let me just add, I do appreciate the amendments that the Committee has put in. I think it moves the Bill in a better direction. But we are concerned that, as I stated earlier, that the Commission's hands will be tied and limited to come up with both creative and effective solutions and policies. And that's very concerning for us.

The Federal process is still ongoing, and especially they're in the process of collecting public comment, as is the State process at the Commission. Turn is engaged at the Commission to try to ensure that it's a robust community engagement process and that we get good information from those on the ground and that we inform some of the decisions that are going to be made at the Commission and some of the solutions that are come up by the Commission.

This Bill will frustrate that process and will in some ways limit the ability of the Commission to come up with some very strong policies. And that's concerning for us. We think it's unnecessary and we oppose the Bill for those reasons.

Thank you. Next witness?

Yes. Good afternoon, chair and Members. Tracy Rosenberg from Media Alliance. Once again, we are opposed to AB 662 for the reasons previously stated.

Thank you. Any additional witnesses in opposition here in room 1200? Seeing none. Moderator let's go to our phone line for witnesses in support or in opposition of AB 662.

Thank you, ladies and gentlemen, if you wish to speak on AB 662, please press one, then zero. Please press one, then zero. To speak in support or opposition of AB. 662. And we have no one in queue.

Great. We're going to bring it back to the Committee. Any questions or concerns as it relates to measure? Senator Gonzalez?

Thank you, Mr. Chair, and thank you, Assembly Member. I know we've talked often about broadband and your Tasha B specials, but for this Bill in particular, I have a couple of questions. I guess I'll state with saying, look, I'm not always on board with what the PUC has done in the past and past sort of decisions and processes with the PUC, but I would say that in this process with broadband. Having legislated on broadband. Of course, many of us have here in this room.

I think there has been some sort of opportunity for locals to be involved, for engagement that has seemed to be a little bit more robust than normal times. But with that said, can you talk about who has been at the table with this particular Bill? Because I think there is a feeling that there's a lack of that engagement with this Bill. And it does limit the ability for the PEC to ensure that underserved, unserved communities per the opposition would be served effectively.

Sure, part of Bead is the affordability aspect. And so the express intention of the Federal program is to serve underserved and disadvantaged communities. So there's nothing in our Bill that would prevent that. But we reached out, we drafted a version, we reached out with amendments, and we talked to Turn, Public Advocates, Office of the CPUC, the California Alliance for Digital Equity, Rural County representatives, next gen policy industry, including US telecom and Cal broadband.

And we have reviewed all the public comments submitted to the CPUC thus far. So that's what we've done. And the Bill tried to kind of thread the needle on how do you allow enough flexibility and I still think, especially with the Committee amendments, how do you allow enough flexibility that they can respond to that without letting them do the priority mapping area, this whole priority mapping area that they did with the FFA.

Gosh, I don't know if I have polite words to describe how that happened, but really did not reach the goal that we wanted, which was to really close the donut holes and really serve disadvantaged and underserved communities. So they went through a year and a half long delay with not the outcome that we wanted to achieve. So I don't know if I would have faith in the CPUC. In fact, I can say I don't have faith in the CPUC's process.

While certain advocates may feel that they have more ability to influence the CPUC than, say, through the Legislature, I can see how those people would then oppose this Bill. But the reality is the CPUC will never listen to us if we don't have a Bill like 662. And I'm committed to, as I said in my opening statement, to continuing to work on some of the drafting of the language.

I think that's the agreement between the chair and I from last week when we agreed to take the amendments, that my consultant and this Committee consultant will continue to work on that language. I would happy to personally meet with anybody over the recess to continue to hear how do we make it flexible so that they feel their side is heard, but we have to put guardrails on the CPUC with this funding or we're going to see the same delays.

And just to be clear, the delays we're seeing with the FFA mean that not all those federal dollars will be implemented in California. We're not going to be able to rip up all the roads and lay fiber to the home and broadband everywhere in California in a period of two years. And so if you look at what that delay is costing us, it's costing us the ability to close the digital divide. And that's why we're running 662.

Well, thank you for that. Do you think that this would add some further delays and further complications? As somebody had mentioned, Ignacio had mentioned from Turn in terms of frustrating the system, because the timing and you had I don't know if you'd mentioned an urgency clause, because the Bead program is currently working on a five year plan, multiple plans, so everything's sort of moving forward and then this sort of disrupts that system.

So I'll let you know. So there's a five year framework. It's more like an outline, right? It's not actually a detailed plan. It's a five year plan that's due by the end of August, there's a 30 day comment period. There's no requirement for the CPUC to take our feedback as Members or any of the public feedback. They have 30 days for public comment, and they could or could not take any of that feedback. That's the current plan. We've thought about adding an urgency clause.

We talked about it last week, and that's something we can consider that would say as soon as it signed into law, there would be that urgency clause. So it would go into effect. And then the CPUC is required to submit the full plan by the end of December. Until that is approved by the federal level, that full December plan, no Bead funding will be released. So we're not interfering with the release of funding.

What we're doing is we're trying to put the guardrails where you have public comment from our advocates into the process. We have the position of the Legislature as those guardrails to the CPUC and still ensure that it goes forward. And we do not have any concerns that they'll be able to do that if there is an urgency clause added. So we're happy to consider that as we move forward.

Okay, so I think there's some difference in opinion in that.

Well, that's actually we've been watching all the things that's actually what the timeline is for the Bead program.

Right. But I think that there's just some difference on how this would affect what's already moving forward. But the last question I have and is just the opposition brings forward, establishes limits on accessing funding that will have the effect of limiting competition in the broadband marketplace and excluding from eligibility, most, if not all projects proposed by municipal, nonprofit, independent.

There's nothing in the Bill that says that. What's left in the Bill is the broad language that prohibits the CPUC from implementing rules, processes, procedures, prohibitions that are not explicitly required by the federal guidelines, because that's what they've done with FFA and hasn't worked for our disadvantaged communities. So we don't want to let them do that again. Requires the CPC to act on applications within 180 days. And we have heard maybe 180 days is a little too restrictive. Maybe we need to refine that.

Happy to continue to have those conversations. But one of the things we've seen with FFA, it's taken us a year and a half to even open the applications. Other states are already putting fiber in the ground, and we just opened applications. And the first grants for FFA will go out at the end of this year. And that's ultimately going to hinder the closure of the digital divide in both rural communities as well as urban and disadvantaged communities.

And the final thing that's left in the Bill is recommendations to the Legislature on how to coordinate the various last mile programs infrastructure grant accounts, the Fair Editor funding accounts. And so one of the problems with our last mile accounts is we had an oversight hearing or we had a meeting with the CPUC specifically on this.

And we have not heard a concrete plan how all the last mile programs are put together, and especially for municipalities and nonprofits, they're not clear if they're eligible for one program or another. Can they apply for both? So that's the other thing that 662 does is it requires the coordination of all that last mile programs. And I think that ultimately is what's going to make a really robust process that does close the digital divide for Californians.

Okay, well, I thank you for those answers. I think we've shared this discussion, and I still have some issues with the Bill. I had to make sure that those particular issues were addressed. I will not be voting on this Bill today. I encourage you, and I know you will continue to work with the opposition on this, but I do think that in my opinion, I feel like this does disrupt that system.

And I don't know how this will continue to provide the good work that has been done so far over the last couple of years to ensure, most importantly, underserved the affordability piece are prioritized. And that at the end of the day, that people feel that they have a place at the table for these discussions that are so very important. So with that, thank you.

And as I said, this is a Tbh special. So we're happy to work with anybody if they want to come to us and happy to continue those conversations. But thank you. Hopefully the version that if it gets out of the Committee today through appropriations, gets the force. Something that you could support.

Senator Durazo?

Yes. Just a quick question. With regards to Legislature, I just have this handwritten, I don't know where I got it from, but you make reference to legislative priorities that may or may not are not being addressed or could not be addressed.

So what's happening now is I've held oversight hearings, I've written letters, I've met with commissioners, and we're not seeing the change. And the change we're asking for is exactly the change I think our community advocates want to see is that are we prioritizing those programs that go above and beyond and are serving disadvantaged communities? Are they serving rural communities? Are they serving the really hard to build out areas? And that's what we want to see.

And so we're not seeing the CPUC coming up with rules in their current program. Obviously, we're coming into the 30 day comment window for the five year plan for Bead, and we will be providing feedback through that process as well. But we haven't seen the responsiveness from the CPUC that they actually want to take the feedback from Legislature seriously. And that's why I think we need 662 to set those guardrails.

Okay. I will also be laying off, but I'm very interested and hopefully we keep adding get there?

Yes, definitely. Keep both of your offices informed.

Thank you. Any further questions or concerns, Senator Seyarto?

So I hope with everybody laying off it, this Bill continues to go forward somehow, because this issue needs to be addressed. I have people in my district asking about this process and where they are in this process and how they're going to benefit. And these are disadvantaged areas that don't have broadband right now. And we really don't have any answers, even after having hearings with these folks. So there is no accountability. We're just waiting and hoping that they get through the process.

And at the end of this process, if we're wrong and it fails, we lose a bunch of federal funding. So I think it's important to allow this to go forward so that we can continue to create these guardrails so that we actually know what is going on. And the good work that I've heard about, somebody has mentioned they're doing good work. Well, I haven't heard about it. I sure would like to see it. I sure would like to know where this is going.

And I would sure like to have some assurance that somehow, at the end of the day, this is going to be successful so that we can take advantage of the federal dollars that are out there. So I will be supporting your Bill. I want this process to work. I want this broadband plan that we talked about two years ago in the Assembly to work. And I think that's what you're trying to do here. And so I appreciate that. And with that, I'll move the Bill.

Thank you. Any further discussion or questions for Senator Dahle?

You mentioned is the rural counties in opposition, they moved to neutral, or where are they at?

So, to be Frank, the amendments came out last week, and we think there might be some question around the 180 days still for some of the advocates. We think most opposition with the amendments that we took should move to neutral, but I don't want to speak for them.

Thank you. Any further discussions, questions or concerns? Hearing, seeing none. Is there a motion on this measure? zero, yes, Senator Seyarto. We have a do pass, as amended to the Committee on Appropriations. Senator I mean, Assembly Member. Would you like to close?

Thank you for giving me a promotion.

Maybe a motion.

Thank you, Members, for your questions and comments. And thank you, Senator Gonzalez, and all of you that have worked on broadband over the last years for your leadership on this issue. In closing, I want to reiterate why it's important that the Legislature is engaged in shaping the future of the Bead program. There are billions of dollars on the line, not just with the Bead program, but with all the existing last mile programs under the CPUC's authority.

Since the passage of SB 156, we have done a lot of reacting to what comes out of the CPUC, and I think it's time that we shift to offense. Although broadband policy is complex, there are different perspectives on how to best close the digital divide. And there's no getting around the fact that decisions will be made by the CPC on the design of the B program.

We can either be proactive and help guide and shape that conversation through legislation, or we can wait to react for what will invariably be problematic in the future. I'm in favor of the former. I think we as legislators have a role to play in shaping the program that affects the most disadvantaged constituents, both urban and rural. And I hope you will be there with me. If not today, then when it comes to the Senate Floor. I respectfully ask for your I vote.

Thank you. And I'll just comment that I think the Assembly Members made it quite clear that she's committed to making sure the Legislature has a voice on how federal broadband funds are being spent here in the state. And I'm confident the author will continue her work with this Committee on any further changes that may be needed to ensure that we can meet that goal without delaying the state's ability to draw down these federal funds. So that's our commitment here.

I think that's what Senator Seyarto has also stated that he's concerned with as well. So with that secretary consultant, please call the roll on AB 662.

Do pass as amended to appropriation Senator Bradford aye. Dahle. Ashby. Becker aye. Caballero. Dodd aye. Durazo. Eggman aye. Gonzalez. Grove. Mcguire. Min. Newman. Rubio. Seyarto aye. Skinner. Stern. Wilk aye. Six to zero.

That measure has six votes. We'll leave the roll open for absent Members to add on. Next up is file item six, AB 9114 by Assembly Member Friedman. You may begin when you're ready.

Good afternoon, Members. It's very fitting that on the day that the Governor signed the infrastructure bills into law, I'm able to bring you AB 914, a Bill that seeks to speed up our transition to clean energy by establishing a two year time limit from the date the application is submitted for a lead state agency to complete CQA for an electrical infrastructure project.

If a state agency fails to meet this deadline, it would have to submit a report to the Legislature setting forth the reasons for why the review was not completed within the time period. By strategically building and replacing electrical lines and other system infrastructure faster, California can position itself to achieve its climate goals while also improving the air quality of disadvantaged communities and reducing the cost of electrification. Testifying in support today is Andrew Kosydar with Southern California Edison. And I would respectfully request an aye vote.

Thank you. You have two minutes.

Good afternoon, chair Members. Andrew Kosydar with Southern California Edison. Meeting California's 2045 greenhouse gas goals will entail building out our grid, our electric grid at a faster rate than historically seen. AB 914 would require an agency to file a report if an environmental review for an electric infrastructure project takes more than two years to complete. Thus, AB 914 is a fairly simple Bill that could help identify sticking points in the build out of the grid. And SCE is pleased to support AB 914 and urges your aye vote thank you.

Thank you. Any additional witnesses in support in room 1200? Hearing? Seeing none. How about witnesses in opposition? Seeing none. Moderator let's go to our phone lines for witnesses in support or opposition of 914.

Of course. Ladies and gentlemen, if you wish to make a comment in support or opposition, please press one, then zero.

We do have a couple that have just queued up one moment. While they're giving their line number.

While they're doing that, can I clarify? I am taking the Committee amendments. Thank you.

We're going to line 42. Please go ahead.

Good afternoon. My name is Madison Vanderclay with the Silicon Valley Leadership Group calling in support. Thank you.

Next we'll go to line 13. Please go ahead.

Good afternoon. Ashley Johnson on behalf of the Pacific Gas and Electric Company in support. Thank you.

And there's currently no one else in the queue at this time, Mr. Chair.

Okay, we'll bring it back to the Committee. Any questions or concerns on AB 9114 hearing? Seeing none. It's been moved by Senator Durazo. We have a do pass as amended to the Committee on Appropriations. And let me just state what those amendments are.

And due to the limited time from when this Bill was heard, on Wednesday, July the fifth, we will adopt amendments proposed in the Senate Committee on Environmental Quality, which are strike the language that states the time limit is mandatory. So delete section two, Public Resources Code 21 well 2110 0.2, subsection B three and add a seven year sunset. Am I correct? And additionally, delete the last line in e of the findings and declaration as it pertains to the language that was previously in the Bill. Right.

Okay. We have a motion by Senator Durazo. I believe it was Durazo. Consultant, please call the roll on AB 9114. I'm sorry, would you like to close?

That was perfect. I accept your closing.

Okay.

Senators. Bradford aye. Dahle aye. Ashby. Becker aye. Caballero. Dodd aye. Durazo aye. Eggman aye. Gonzalez aye. Grove aye. Mcguire. Min. Newman. Rubio. Seyarto aye. Skinner. Stern aye. Wilk aye.

Bill has 11 votes. We'll leave the roll open for absent members to add on. I don't see Assembly. No. We have Grayson. Right. You're doing rendered. Okay, then rendered up. So, file item seven, AB 1061. Thank you.

Mr. Chair and colleagues. The analysis does a good job in articulating what the bill does, so I'll be brief. This bill requires the procured and maintained by let me start with the resources procured by the Department of Water Resources as part of the electricity reserve, that the program be subject to the cap and trade and have their greenhouse gas emissions reported to the Air Resources Board. In essence, that's what the bill does. We have one witness Katelyn Roedner Sutter with the California State. She's the Director of Environmental Defense Fund.

Thank you. You have two minutes.

Thank you very much. Good afternoon, Chair and members of the committee. Katelyn Roedner Sutter, California Director for EDF. I think many of you are familiar with EDF. We are an international environmental NGO working on a number of issues here in California and around the world, but a lot on climate and energy policy here. Including the Cap and Trade Program. We're very pleased to support AB 1061. We appreciate Speaker Emeritus Rendon and Assemblymember Garcia for bringing it forward. Fundamentally, this bill is about providing clarity and consistency to ensure that any electricity resources brought online as part of the Strategic Reliability Reserve are subject to the same requirements and obligations as other electricity resources, namely the reporting of greenhouse gas emissions and compliance with the Cap and Trade Program. We all recall the rolling blackouts of a few years ago and the state has taken significant steps to keep the lights and more importantly our air conditioning on. But at the same time, we should be making sure that those additional resources, to the extent that we need to call upon them, uphold the same standards of climate protection that we expect from the rest of the power sector in California. Over the last 20 years or so, California has seen really notable declines in greenhouse gas emissions from the electricity sector, including the intensity of emissions from the electricity sector. So the emissions per megawatt hour of power has been cut in half. At the same time, our economy has grown and we've taken some really impressive strides in deploying zero-emission resources. The Cap and Trade Program provides a really powerful incentive to prioritize renewable and zero-emission resources over fossil fuels. And any additional generation that is brought online as part of this Reserve should follow the same path. So by providing this clarity, AB 1061 just helps ensure that California stays on track from all of our power sector emissions and keeping us cool this summer. Thank you.

Thank you. Any additional witnesses here in 1200 in support of AB 1061? Seeing none. Witnesses in opposition? There are none. Let's go to our phone lines for witnesses in support or opposition of AB 1061.

Ladies and gentlemen, if you wish to make a comment in support or opposition, press one then zero. There's currently no one queuing up at this time, Mr. Chair.

Thank you. This bill sort of seems to posit that these facilities are not already subject to these rules and it just sort of seems to me that pretty clearly that they are. I guess question is, are there examples where DWR or the facilities are claiming they are somehow exempt? I'm just trying to say why do you think this bill is needed?

We'll bring it back to the committee. Senator Becker.

According to the author and the points that I've been given is that it's unclear whether or not they are going to be accounted for. I'm going to ask the witness if she wants to get into further details on that.

That's correct. There's just some ambiguity in the package of legislation that created this Strategic Reliability Reserve. So this is just to provide clarity so there isn't any ambiguity.

Got it. Okay, good. I know it's not the primary author. That's fine. It sounds like there's certainly no harm in restating that.

Thank you. Senator Grove.

Thank you, Mr. Chair. I just have two questions, and correct me, please, if I'm wrong. The diesel generators procured at the beginning of this program can't be used after July 31, 2023. So at the end of this month, those diesel generators that this bill covers will no longer be in production or in operation. And then as of January 2023... I'm sorry, go back. So, again, the diesel generators in the beginning of this bill are nonoperational according to current law, as of July 31, 2023. So there'll be no emissions going forward on those generators that are identified in this bill. And then the four natural gas facilities under contractor until the end of 2023. But DWR is already in negotiations to determine the feasibility of extending those operational facilities because Diablo and all those things are a necessity to all of our constituents who want to flip a switch and have the lights come on. And so far, the Cap and Trade... or the CO2 emissions that have been measured so far as of January is 2491.1 tons. So that's well below the threshold of mandatory reporting. So is there something that I'm missing the bill covers that either isn't going to exist at the end of this month, on the 31st, in a few days, or is already in negotiations with DWR? So am I missing something else?

Senator that is a good question. I don't have the answer to your question. However, I'm going to look to the witness and see if she might have much more clear.

I can take a stab at this. Yeah.

Thank you. And I apologize. I know you're not the author and you're just carrying the bill.

Last time Mr. Rendon asked me to present a bill, I would imagine. I'm just kidding, I hope not.

Go ahead, ma'am. I apologize.

It's a good question, Senator. So any resources that are below that mandatory reporting is that is still the case. So that is not changing anything. And this is not requiring any specific source of power or type of power or anything like that. It's simply saying that these resources have to abide by the same reporting and compliance obligation rules. So for the one you cited, that was below the threshold, this wouldn't, to my understanding, change anything. And it isn't going to change any of... it doesn't dictate where the power comes from, only that based on the emissions of that power, you have to abide by the same rules that other power resources in the state have to abide by.

So those two power sources, right, there's only the gas generators or diesel generators that are abolished at the end of this month according to legislation. And then the four natural gas facilities, there's only those two that are affected. Is that true or not true?

I think so far that is correct, as far as I understand it. Though, this also opens with this Strategic Reliability Reserve. We could potentially need additional reserves in the future from other sources.

Okay, but I'm just going to just make it clear one more time because I'm trying to figure out why the bill is necessary if it covers generators that are obsolete by the 31st of this month, like in 20 days, according to current state law. And the other entities that are included in this piece of legislation are the four facilities under contract until 2023. But DWR is already negotiating those contracts. That's the only two, I don't know, providers of energy that we have, right, that is covered under this bill, and they're both obsolete. Well, one's obsolete and one is under negotiation. Is that correct or not?

So without having this whole list in front of me, there are also... this might... this might be more helpful.

Also I'm seeing here on page three the additional procurement efforts that are underway by Department of Water Resources that I think were not accounted for in discussion last year with the reserve. The consultant with her assistance has just said there's also imports that are coming in as well. So we want to make sure that they are accounted for in the Cap and Trade Program.

Okay, thank you. Thank you for clarifying that. I just couldn't see what the bill was covering. So thank you.

Thank you. Senator Stern.

Thank you, Mr. Chair. And thanks for bringing this forward, Assemblymember, on Mr. Rendon's behalf. I'm trying to get a little more clarity on what exactly this bill would do. The analysis alludes to I think the wording is in discussions that DWR is, quote, unquote in discussions regarding three once-through cooling natural gas plants. If the State Water Board controls extends the compliance. My sense is that it's well beyond discussions at this point that they've presented it a business meeting, a $1.2 billion capacity payment, and that that's going to be voted on at the Water Board in early August and that then the commission will then vote on it after that. This is more than a discussion. This is over $1 billion that we're about to set aside for this program. And my big concern, I'm so grateful that you all decided to try to get some cleanup and some clarification around DWR's process because I think we're a little confounded too. We're saying we carefully negotiated this language in AB 205 last year during the trailer process, during Diablo and all those fights. And it was a tough process. The promise that was made to us from the Administration and from DWR in those discussions is to comply with what is now section four in the statute that in fulfilling the requirements of the division, they're going to prioritize investments in feasible cost-effective zero-emissions resources comma and then feasible cost-effective conventional resources. So in other words, not just a default to extending the life of gas plants in hard-bitten communities. And yet the $1.2 billion did no diligence whatsoever on any alternative resource other than extending those gas plants. And I want to try to get some clarity because Senator Becker looked at this during his budget sub-process, but DWR told us that they're not even allowed to look at energy storage because of how they interpret the law, that somehow by being a grid-connected resource, it becomes a fossil fuel resource. So I just want to make sure this bill doesn't sort of further exacerbate that problem where through some strange reading of the statute we sent them that they're not looking at anything else except for firing up gas plants with this reserve payment in disadvantaged communities. So I'm hoping maybe something you could bring back to the author just as a consideration to say maybe this cross reference will do that. But is some additional clarity needed, in other words. That things like energy storage, I think you mentioned the Distributed Power Backup Program, the Demand Response Program, some other diligence that's needed before we just default to setting aside $1.2 million for gas, because I'm worried that those plants aren't going to be there when we need them. We've had issues at those plants over the years. That's actually one of the reasons they're being proposed to be shuttered. And so if this is really supposed to be the most reliable resource, is DWR really doing that homework? So maybe it's something the author or you or committee would be willing to look at going forward is just to make sure that DWR is complying with that section four in the statute and looking at other zero-emission resources. And that energy storage should be considered one of those, even if it is grid-connected. So I don't know if you're willing to take that back to the author.

Yeah, we'll take it back to the author as well as our witness here who is working closely with them. So thank you.

Thank you. I'll be supporting today.

Thank you. Any further questions or concerns here? Is there a motion by committee members? It's been moved by Senator Durazo. We have a due pass to the Senate Floor. And let me just state amendments are needed to prevent any chaptering issues with the recent trailer bills voted on on the Senate Floor and erode to the governor, specifically SB 123 and SB 124. And obviously they were signed today, so we expect those amendments to be taken up on the Senate Floor. So just want to share that and on that note, would you like to close?

That's it. Thank you.

Okay, Consultant, please call the role on SB 1061.

Senators Bradford. Bradford, aye. Dahle. Ashby. Ashby, aye. Becker. Becker, aye. Caballero. Dodd. Dodd, aye. Durazo. Durazo, aye. Eggman. Eggman, aye. Gonzalez. Gonzalez, aye. Grove. McGuire. Min. Newman. Rubio. Seyarto. Seyarto, no. Skinner. Stern. Stern, aye. Wilk. Wilk, no. Eight to two.

We have eight to two. We'll leave the roll open for absent members to add on.

All right, thank you.

Well, are you going to yield your spot, Mr. Grayson? Okay, Mr. Garcia, you can continue with your measure.

And I want to start off by saying that we welcome any and all questions on this particular Bill. This is AB 1569. That would establish the Lithium Valley Office of Development. That would help in the facilitation of working with the multiple agencies that have a role in the development of the lithium economy here in California.

Analysis does an excellent job in highlighting kind of the history of what's been going on in the Imperial County as it relates to lithium recovery opportunities and how it ties into our ambitious and aggressive climate goals, as well as our transportation electrification goals. Respectfully ask for your aye vote.

Thank you. Any witnesses here in room 1200 in support of this measure?

Chair and Members, Oracle Gonzalez on behalf of the Salton Sea Authority in strong support, and thank Member for his leadership.

Thank you. Next witness.

Chair and Members, Alejandro Solis on behalf of Comite Civico Del Valle in support.

Thank you. Any additional witnesses in support? Seeing none. Let's now go to witnesses in opposition. Are there witnesses here in 1200 who are in opposition of this measure? Seeing none. Moderator let's go to our phone lines for witnesses, support or opposition of AB 1569.

Of course. Ladies and gentlemen, if you wish to speak in support or opposition, please press 1 and 0. We'll be going to line 59. Please go ahead.

Daniel Sanchez on behalf of the Clean Power campaign in support. Thank you.

Thank you. Next, we go to line 55. Please go ahead.

Eric Reyes. Los Amigos de la Comunidad in support of Garcia's Bill.

And there's currently no one else in the queue at this time, Mr. Chair.

Great. We'll bring it back to the Committee. Any questions or concerns, Senator Grove?

Thank you, Mr. Chair. So, I know in the author's statement it says that California's Lithium Valley, located in the Imperial Valley, contains one of the largest, most environmentally sustainable lithium reserves in the world. I do agree with that statement. There is a large Reserve also in my district, in the Boron community, there's a lithium tax that I know your Bill doesn't address.

But if we develop lithium in Boron, in this small little town outside of in the desert community, the tax that's collected, we have to give to the Salton Sea, instead of rebuilding and supporting the town which the extraction came from. Is there anything in your Bill I apologize. Not read all of it. I apologize. Is there anything in your Bill that addresses that? And the reason why I ask is I know Senator Padilla has a Bill that's addressing I just in all fairness and equity.

If this small town is going to be affected by lithium extraction, they should be able to keep those resources instead of sending them down to your community where they can rebuild their own town because of the extraction impacts on that community. So is there anything in your Bill that affects that?

No. And this Bill focuses specifically on creating an office of Lithium Facilitation, not just specifically for Lithium Valley in the case that you've just highlighted, but for the entire state that could help facilitate the conversations with all of the multiple agencies that would be necessary to be involved for permitting purposes.

But I would like to just state for the record the conversation that you and I have had as it relates to that unintended consequence of the tax that was approved, that we were more than amenable to any cleanup language specifically to that tax structure that was set for purposes of making sure that your community or any other community throughout the state would have whatever tax collected allocated back to that region. So the answer is no. Nothing in this Bill addresses that.

I think the conversations that we left off with yourself were that that could be something that's done in a budget trailer Bill cleanup. They think the Administration was very amenable to that as well. And you had mentioned that the Senator from the area also was open to that conversation as well, and we would support that.

No, thank you very much for clarifying that. I appreciate very much. I just wanted to know if it was included in this Bill. I appreciate your comments.

Great. Thank you, Senator Durazo.

Yeah, I will be supporting, of course. And I'm really glad to see that when you're looking at the economy in that area, that you're including manufacturing in addition to construction, the reclamation of the lithium, all those jobs, because otherwise we have the inclination to just, zero, we built it, construction, that's the end of it. Who cares what happens to the people doing the rest of the work? And so really glad to see that included here and hope that the standards are those that workers deserve.

Thank you for those comments. This is something that we're looking at kind of developing an entire ecosystem on site, from the recovery process to the manufacturing to perhaps even attracting those end users of these products, whether it be large battery storage or for any products, including car batteries that we're looking for.

Yes. Senator Grove.

Thank you. And you did say that it's going to be for statewide all projects, not just the Salton Sea project.

Yeah. The Lithium Valley office is focused on the geographic area of Imperial County. But given the footprint of lithium mining or recovery throughout the state, it makes sense that this office also kind of helped facilitate those efforts as well. The way the Bill is set up, it is focused specifically to the Lithium Valley region of the state.

I saw that, and that kind of gave me concern, because, like I said, we do have an ability to mine lithium as well in a borax or a boron plant in the desert area, which is a company town, a union town, and it's a very strong community contributor, I guess you would say, to the state, as far as lithium. But your Bill does focus strictly on.

That is correct, but I don't see why we couldn't kind of broaden that effort.

Okay, I appreciate that. Thank you, sir.

Senator Becker.

I just want to thank you for your leadership on this. And I was noticing that the analysis said we could potentially supply up to one third of the world's lithium, if we even got close to that, it just would be a massive industry for the state. So appreciate your leadership and look forward to supporting the Bill.

Thank you.

Thank you. And I, too want to just thank the Assemblyman for your strong and consistent leadership here and a strong commitment on in state lithium production here in California. And as stated, we have a wealth of resources here that would help alleviate the crisis that is being created over in Africa where they're exploiting young kids. So I appreciate your leadership on this, and at the appropriate time, I would like to be added as a co author.

Thank you. We do have the opportunity to produce the cleanest, greenest lithium economy in the world here in California, and we're fortunate enough to have it in Imperial County, where historically, it's been a community that has led the charts when it comes to unemployment, 28-29% on its highest and at its lowest and best, 16%. So that gives you a sense of how significant this opportunity is for that region, but for the state as a whole.

And with that, I'd like to close and just respectfully ask for a high vote.

Thank you. We have a due pass to the Committee on Appropriations. Do we have a motion? It's been moved by Senator Gonzalez. Consultant, please call the roll on AB 1569.

Senators Bradford, Aye. Dahle, Not Present. Ashby, Aye. Becker, Aye. Caballaro, Not Present. Dodd, Aye. Durazo, Aye. Eggman, Aye. Gonzalez, Aye. Grove, Aye. McGuire, Not Present. Min, Not Present. Newman, Not Present. Rubio, Not Present. Seyarto, Not Present. Skinner, Not Present. Stern, Not Present. Wilk, Aye.

That measure has nine votes. We'll leave the roll open for absent Members to add on. I would also ask that we notify those Members who are not in the Committee, we're now taking up our last measures of this evening, and we would like all Members who are absent to report to the Committee so we can close up those outstanding items. Next up is file item eight, AB 1198, by Assembly Member Grayson.

Good afternoon or quickly approaching evening, Mr. Chair and Members. AB 1198 requires the energy unit within GoBiz to better ensure minority small businesses and disadvantaged businesses in areas of the state with high poverty and low investment participate in helping the state achieve its climate goals. California has been and continues to be a global leader on climate change policy with goals of achieving carbon neutrality by 2045.

However, the state's ambitious plan to achieve 100% clean energy and net zero emissions is unlikely to be met without measures that incentivize small businesses to make clean energy investments. Small businesses play a critical role in fighting climate change. California small businesses account for 99.8% of businesses in the state. And of the state's 4.1 million small businesses, 1.2 million are minority owned. While an individual small business may have a relatively small carbon footprint, the collective impact of those emissions can be huge.

Despite the significant role that minority small businesses have in the clean energy transition, there remains a huge gap in minority small business enterprise participation in the market transition to a low carbon future. Small businesses may lack the same resources and support that larger corporations have when it comes to reducing emissions and implementing new technologies and operations. It is essential that minority enterprises actively participate in delivering solutions that help California achieve its aggressive climate goals.

As such, the state needs to support disadvantaged businesses by providing effective pathways and resources to create community wealth building opportunities. AB 1198 will identify existing gaps in participation and put forward solutions to help support small businesses in the market transition. Specifically, AB 1198 requires the Energy Unit within GoBiz to identify resources to assist businesses in the transition to a net zero economy and to also identify current participation levels of disadvantaged businesses.

Furthermore, the Energy Unit is tasked with holding public workshops and engage with stakeholders to develop recommendations on addressing barriers to accessing energy industry resources. And it's my hope that AB 1198 will help California achieve its climate goals while supporting and uplifting our essential small businesses. And with that, and through the Chair, I have two witnesses that will self introduce.

You have two minutes.

Thank you.

Good afternoon, chair. Bradford and Senators. My name is Andrea Cow, and I'm the Director of public policy of the California Asian Pacific Chamber of Commerce, which represents the interests of the over 746,000 Asian American and Pacific Islander owned businesses across California. Senators, as you know, California has set an ambitious but necessary goal of achieving carbon neutrality by 2045. Meeting this objective will require a sustained and inclusive economic transition to alternative and clean energy production.

However, until now, programs and services to support this transition have had a limited impact on the 88% of California small businesses with less than 20 employees, many of which include companies owned by women, people of color, disabled individuals, veterans and individuals from disadvantaged communities. The Cal Asian Chamber, along with the other AB 1198 cosponsors and supporters, want to emphasize the importance of implementing new and more intentional strategies for assisting these historically underserved small businesses and workers so they can fully participate in an equitable transition.

A good starting point to addressing market transition deficiencies is better leveraging existing energy programs by removing barriers to serving diverse small business owners and workers in disadvantaged communities. AB 1198 advances a three pronged approach, including, one, a disparity analysis between the eligible small business and worker populations and the actual program usage. Two, a survey of non rate payer energy industry programs to identify those with requirements or award criteria that mitigate equity disparities.

And three, the creation of a technical advisory workgroup that includes small business advocates such as chambers to help GoBiz better understand and address why certain business owner groups are not accessing available energy programs. I want to thank Assemblymember Grayson for authoring AB 1198, along with Senators Alvarado and Caballaro for coauthoring this critical piece of legislation. Thank you for your time.

Thank you. Next witness.

Good evening, Senators. Julian Canete, President, CEO, California Hispanic Chambers of Commerce. I think our partners at the California Asian Pacific Chamber said it best, so I won't go into and repeat what they have already said.

But we do want to say that AB 1119 is meant to put in place guidelines in providing a report to the Legislature on what we feel are the true impacts on small business regarding energy policies and to identify solutions or possible incentives for small business to make those investments into the clean energy field. So with that, we feel that by working with other departments throughout the state and identifying those incentives are important to our small businesses to grow in this new clean energy environment.

The gathering of Denna will again assist us in identifying what those incentives should be moving forward. So with that, we ask for your I vote on AB 1198. And I thank Senator Assemblymember Grayson and his staff for all the hard work they've put into this Bill. Thank you.

Thank you. Any additional witnesses here in the room in support of 1198? Yes, 1198.

Mr. Chairman, Members Mel Osagai for a.

Proud co sponsoring organization, California African American.

Chamber of Commerce, as well as the.

Greater Sacramento Urban League in strong support.

Thank you. Next witness.

Good afternoon, chair and Members. Andrea Devoe. On behalf of the California Forward Action Fund in support.

Thank you. Any additional witnesses here in the room in support? See none. Witnesses in opposition? See none. Moderator let's go to our phone lines for witnesses in support and or opposition to 1198.

Of course. Ladies and gentlemen, if you wish to make a comment in support or opposition, please press one, then zero a this time. We do have someone that has just queued up one moment while their line number is given. And we'll be going to line 46. Please go ahead.

Hi, my name is Addison Peterson with the California Association for Micro Enterprise Opportunity, better known as Cameo, a network of micro lenders and technical assistance providers to small business coaching organizations. We're in strong support of AB 1198. Thank you.

And there's currently no one else queued up at this time, Mr. Chair.

All right, we'll bring it back to the Committee. Are there any questions or concerns as it relates to 1198, Senator Wilk?

Yeah. Thank you, Mr. Chair.

I want to thank you, Assemblyman, for bringing forward this Bill. And I move it at the appropriate time.

This is the appropriate time. All right. Any other questions or concerns? I, too, assembleymember Grayson, want to thank you for this measure. As a person who's been a longtime supporter of supplier diversity since I've been in the Legislature and even before I got here, carrying on the tradition of the Late Gwynn Moore, who established supplier diversity under Junior Order 156. This is critically important.

So it's, as you stated, making sure that not only women owned businesses have a seat at the table, but those minority owned businesses, as well as our disadvantaged, I mean, disabled veterans, also have a seat at the table. So it's appropriate time. I would like to be added as a co author, if that's appropriate.

Would be honored.

Thank you. If there's no other comments, would you like to close?

Respectfully ask for a vote.

Thank you. We have a due pass to the Committee on Appropriations Consultant. Please call the role on AB 1198.

Senators. Bradford, Aye. Dahle, Aye. Ashby, Aye. Becker, Aye. Caballaro, Aye. Dodd, Aye. Durazo, Aye. Eggman, Aye. Gonzalez, Aye. Grove, Aye. McGuire, Not Present. Min, Not Present. Newman, Aye. Rubio, Aye. Seyarto, Aye. Skinner, Not Present. Stern, Aye. Wilk, Aye.

That measure has 15 votes. We'll leave the roll open for those absent Members. Again, we're going to ask those Members who are not present here in room 1200 to make their way as soon as possible so we can close it. Thank you. Mr. Grayson. Congratulations. Your measures out. Now we're going to go back to the top of the agenda and we're going to allow those Members who are absent to add on at this time. We'll start with file item one. AB 41.

Due pass is amended to the Judiciary Committee. Current vote, 81. Dahle. Becker. Caballero. Dodd.

Aye.

Dodd aye. Gonzalez. Okay. Mcguire. Newman.

Aye.

Newman aye. Seyarto.

No.

Seyarto no. Skinner. 10 to two.

Measure currently stands 10 to two. We'll leave the roll open for absent Members to add on. Now move on to file item two. AB 593.

Due passes amended to appropriations. Current vote, 73. Chair voting aye. Vice Chair voting no. Ashby.

Aye.

Ashby aye. Caballero. Dodd.

Aye.

Dodd aye. Eggman. Mcguire. Min. Newman.

Aye.

Newman aye. Skinner. 10 to three.

Eggman I.

Oh, Eggman I.

That's currently 11 3. We'll leave the roll open for absent Members to add on. Now moving to file item three AB 604.

Due passes amended to appropriations. Current vote, 52. Chair voting aye. Vice Chair voting no. Ashby.

Caballero aye. Dodd.

Aye.

Ashby aye. Caballero.

Aye.

Aye.

Dodd aye. Eggman.

Aye.

Eggman aye. Mcguire. Min. Newman.

Aye.

Newman aye. Rubio.

Aye.

Rubio aye. Skinner. Stern.

Aye.

Stern aye. Wilk.

12 to two. We'll leave that measure open for Members to add on. Now moving on to file item four. AB 662.

Due pass is amended to appropriations. Current vote, 60. Dahle. Ashby.

Aye.

Ashby aye. Caballero.

Aye.

Caballero aye. Grove.

No.

Grove no. Mcguire. Min Newman.

Aye.

Newman aye. Rubio.

Aye.

Rubio aye. Skinner Stern. 10 to one.

Current votes, 10 to one. We'll leave the roll open for Members. Absent Member sat on. Now moving to file item six. AB 9114.

Due passes amended to appropriations. Current vote, 110. Ashby.

Aye.

Ashby aye. Caballero.

Aye.

Caballero aye. Mcguire. Min Newman.

Aye.

Newman aye. Rubio.

Aye.

Rubio aye. Skinner.

Min aye.

Min aye.

What's the count? 16 to 0. We'll leave the roll open for absent Members. Now moving on to file item seven. AB 1061.

Due pass is amended or due pass to the Senate Floor. Current vote, 8 2. AB 1061. Dahle Caballero.

Aye.

Caballero I. Grove. Mcguire. Min.

Aye.

Min aye. Newman.

Aye.

Newman aye. Rubio.

Aye.

Rubio aye. Skinner.

Aye.

Skinner aye. 13 to two.

Current vote, 13 to two. We'll leave the roll open for absent Members. Now we're moving to AB. File item 81198.

Do pass to appropriations. Current vote, 150. Mcguire. Min.

Aye.

Min aye. Skinner. AB 1198 Grayson.

Aye.

Skinner aye. Mcguire. AB 1198. Grayson. Current vote, 17 okay. AB 1198. Do pass to appropriations. Mcguire.

Aye.

McGuire aye. so eighteen.

What is that?

18 to zero?

18 0. That measures out. Closed, I should say. Now moving on to file item nine. AB 1569.

Do pass to appropriations. Current vote, 90. Dahle. Caballero.

Aye.

Caballero aye. Mcguire.

Aye.

Mcguire aye. Min.

Aye.

Min aye. Newman.

Aye.

Newman aye. Rubio.

Aye.

Rubio aye. Seyarto. Skinner.

Aye.

Skinner aye. Stern.

Aye.

Stern aye. 16 to zero.

That measures 16 to zero. Is that closed? We'll close that. Now we're going through the row one last time, starting at top of the file. File item one again. AB 441.

AB 41. Dupast amended to Judiciary Committee. Current vote, 10 2. Chair voting. aye. Dahle. Gonzalez. Mcguire.

Aye.

Mcguire aye. Skinner.

Aye.

Skinner aye. 12 to two. 12 to two.

That measures close. Now moving on to file item two.

AB 53. Due passes amended to appropriations. Current vote, 113. Chair voting, aye. Vice Chair voting no. Caballero. Mcguire.

Aye.

Mcguire aye. Min.

Aye.

Min aye. Skinner.

Aye.

Skinner aye. 14 to three.

Measures out 14 to three measures closed. Now moving to file item three. AB 604.

Due pass is amended to Appropriations. Current vote, 12 2. Chair voting, aye. Vice Chair voting, no. Mcguire.

Aye.

Mcguire aye. Min.

Aye.

Min aye. Skinner.

Aye.

Skinner aye. Wilk.

15 to 215 to two, that measures out, it's closed. Now file item six, AB.

What's the vote count?

914 following four, AB, 662.

What's the vote count on this?

Due passes amended to appropriations. Current vote, 10 1. Chair voting aye. Dahle. Gonzalez. Mcguire.

Aye.

McGuire aye. Min.

Not voting.

Min not voting. Skinner. 12 to 1.

12 to one, that measures out. Now moving on to file item six. AB 9114.

Due passes amended to appropriations. Current vote, 16 0. McGuire.

Aye.

Mcguire aye. Skinner. 914.

Aye.

Skinner aye. 18 to 0.

18 to zero. That measure is closed. Now file item 71061.

Do pass to the Senate Floor. Current vote, 13 to two. McGuire. McGuire aye. Skinner voted 14 to 2.

14 0? 14 2. With Skinner up on this. Okay, that measure is close. Are we complete?

No. Yeah, we're good.

We're good. All right. That concludes our hearing to I want to thank everyone for your participation in today's hearing. The Senate Committee on Energy, Utilities and Communications is now adjourned. Thanks to staff and everyone for their participation.