Assembly Select Committee on Select Committee on Retail Theft

Good afternoon. We're bringing the Select Committee on Retail Theft to order. I want to welcome everyone to the inaugural hearing of this Select Committee, which Speaker Rivas recently created to explore the challenge of retail crime that our communities are facing throughout the state. In order to provide a forum for local participation on this issue, we hope to hold at least two additional hearings, one in the Los Angeles area and one in the San Francisco area.

Dates for these additional hearings will be announced as they're confirmed today. We'll be hearing from three panels, and on each panel we've endeavored to bring together a variety of stakeholders and a range of perspectives.

We recognize that some perspectives that we need to explore are not reflected in today's agenda, for example, a focus on online fencing operations and the adequacy of tools to prevent online crime, as well as our ability to hear directly from small business owners and local officials and leaders who can bring real life examples and ideas for reform, which will be subjects that we will address at upcoming hearings in Los Angeles and in the Bay Area.

For those who wish to participate in public comment at the end of today's hearing, we will open the mic for public comment in person here in room 1100. I want to thank everyone who's engaged so far and say that we look forward to continuing to learn from and with you as this Select Committee continues its work into 2024. Retail crime, which encompasses shoplifting, commercial burglary and commercial robbery involving force, is a crisis across the nation.

But its impact is particularly acute here in California, most notably, but not exclusively, in the Bay Area, the Central Valley, the Los Angeles and Los Angeles County, with my district being one of those hardest hit. I applaud the Governor and the Legislature for recognizing the gravity of this issue by investing over two hundred sixty million in combating organized retail crime. But we all understand that more needs to be done.

Since taking office about a year ago, I've received countless calls from community leaders, council Members, Chamber of Commerce, presidents, business owners and operators, public safety officials and residents expressing concern and sometimes outrage over these incidents. What we have before us is no easy task. Retail crime is an emotional issue for many of our constituents. Business owners fear for their livelihoods, workers fear for their well being, and Members of the public worry that it may no longer be safe or convenient to frequent their neighborhood stores.

We are here today to ask ourselves the hard questions of why this is happening and what we both as legislators and as a community, can do about it. How did we get here? What do the numbers say and in what ways are the numbers not telling the whole story when we hear that petty shoplifting has gone down in some places, is that because theft has decreased, or is it because there's an inadequate enforcement and reporting of crime? Does perception match reality, and does that distinction matter?

How do we avoid the mistakes of the past while navigating this rapidly changing world and assuring that we take steps to really solve this problem and move into a better future? I'm sure that many of you in this room have experienced the inconvenience of having to call someone over to unlock the toothpaste or laundry detergent. Or perhaps, like many, like so many, you decided to buy online instead. Yet another way retail crime has undermined local businesses in our communities.

But retail crime is not only bad for business, it also undermines safety and the perception of safety in our communities. And when retailers close their doors, those burden locations become dead zones, workers lose their jobs and areas become blighted and the entire community suffers. Much of the discussion around retail crime has revolved around whether Prop 47 is good or bad and whether we need to modify it.

While Prop 47 is clearly a backdrop to our inquiry, I hope this Committee will focus on identifying the root causes of this growing trend of retail crime and the best approaches to address it. Once we have done that, we can consider steps that we can take this year in the Legislature and what parts of a comprehensive strategy might require. Going back to the voters, I have a host of questions that need to be answered.

Some of them are how do we get to the organized crime rings? Is the problem one of defects in our laws or one of lack of reporting and enforcement? Is there a need to modify our laws to more easily aggregate multiple crimes that happen at different times and locations to have better tools to stop organized rings. Is the $950 felony threshold the problem, or is there a lack of enforcement for misdemeanor theft, which already carries up to a year in jail?

While every member of this Committee will have their own questions, I know that each of my colleagues shares my desire to tackle this growing challenge, as does Speaker Rivas. With that, I'd like to welcome our panelists and audience to the forum and give Members of our bipartisan Committee an opportunity to provide opening comments. We're fortunate today to have nearly all of our Committee Members present, and I want to thank them all for traveling up to Sacramento from their homes because of the importance of this issue.

But in the interest of time, I'd like to ask each member to limit opening remarks to about two minutes to ensure that everyone has an opportunity to speak. And so that we can get to the presentations from our various panelists, I'd like to start by recognizing assemblymember McCarty, the new chair of the Public Safety Committee, and then I'll recognize others from there.

Thank you, Assembly Members of Zbur, for gathering us here today. And I know that the speaker is going to be joining us as well. And I think it's important to note that this is the only Select Committee that we established in the final months of 2023. It's an important topic that we hear from across our state, and we need to be sobered by the facts and the reality. And this is what this Committee is about.

There's a lot of opinions and factoids and see things on TikTok and Instagram, but this is about learning what the reality is. We've all seen these things with our own two eyes. I saw it as recently as four days ago in San Francisco right in front of me, a retail theft, a confrontation with the security guy over going over the counter, ripping off some prescriptions. And I went and saw it and I asked some questions. So we've all seen it. But this isn't about overreacting.

It's about looking at what's before us today and potentially bringing some real solutions. So as you mentioned, I do take this new position as chair of the Public Safety Committee seriously and partnering with this Committee and realizing that our constituents in Sacramento and California want us to take this issue seriously and not just tinker around the margins and focusing on accountability, real accountability, more accountability. But also the flip side, don't overreact.

We're not going back to mid 90s and mass incarceration, 20 years plus for stealing a piece of pizza. So I think we need to kind of think those bookmarks in reality and focusing on what options we have. And I will say that this is the beginning, but in the policy Committee, we will take these potential remedies seriously and we will act this year in 2024 and bring it about some solutions that fit this entire State of California. Thank you.

Thank you, assemblymember McCarty. I'd like to now recognize Assembly Member Pacheco. I'm going to go back and forth.

Thank you, Mr. Chair. I just want to say it's such a pleasure to be here with my Committee Members, with Mr. Chair and with everyone here in the audience. I'm looking forward to the discussions that we will have in respect to retail theft. We have seen that in California there has been an increase in retail theft with 90% of small business retailers experiencing theft at their stores, and 83% believing retail theft is at least a major issue. And so we are taking this issue serious.

We're looking forward to the conversations that we will have today and throughout the State of California. And so I want to thank all of you for being here for having these important conversations. And my hope is that we find some improvements and evidence based solutions to this very serious issue in the State of California. So thank you.

Thank you. I'd like to call on Assembly Member Alanis.

Thank you, Mr. Chair. Thank you, everybody, for joining us today. Looking forward to hearing different perspectives on how retail theft has affected California in General. I'm looking forward to the remedies that we may be coming up with. It's unfortunate that our businesses for these many years have had to suffer the burdens of retail theft, and I'm hoping that this Committee will give them some hope for the future to where they could be helped out. Thank you.

Thank you, Assembly Member Ortega.

Thank you, chair and committee members, as well as our speaker, for allowing this Committee to happen today. As, Wood mentioned, this is an important issue impacting the entire State of California and something they were looking to take seriously comprehensively, to develop some action coming out of these different committees that we're going to be hosting. As your new labor chair, I'm specifically thankful that we're having such a comprehensive approach to this by making sure that we invited UFCW.

I will be particularly looking at the health and safety of many of the employees that have been on the front line of some of the retail theft that's been happening. So thank you so much. I appreciate the thought of this.

Thank you, assembly member. Now I'd like to call on Assembly Member Fong.

Thank you, chair Zaber, for organizing this important Committee hearing. We have all seen the horrific, brazen flash mop robberies at shopping centers, which are becoming more and more prolific. Thieves are shamelessly stealing packages off shelves, trucks and our porches. And that's an area certainly that needs also a lot of attention. Porch pirates are robbing more packages with the holiday season. The questions we are faced with now are why has retail theft increased so much?

Or better yet, why are thieves arrested only to be released just hours later? Why are there not more consequences for these criminal activities? The news often shows high end stores being smashed and trashed, but the mom and pop shops in my community and Department stores throughout the Central Valley have not been spared. Contrary to what some may claim, these criminal heists are not victimless crimes. They create a dangerous situation before during and especially after the crime.

As thieves rush to getaway cars, shoppers and employees are left terrified and traumatized. While law enforcement officials are doing a tremendous job at catching these thieves, criminals know that current laws hamstring the District Attorney's ability to prosecute them. Accountability must be brought back to deter these criminals. There must be teeth in the laws to change behavior, to set a standard of decorum for a civilized society and keep the public safe.

Every single time there's a flash mob robbery where our sense of security is eroded, each of these heists take away from our peace of mind when we go shopping with our families, we as a community deserve to feel safe, and it's time that we side with law enforcement and now criminals. Thank you, Mr. Chair. Thank.

Thank you, Senator Bonta, did you want to make any opening comments?

Thank you, Mr. Chair, for convening this very important conversation. It's not lost on me that while we are sitting here, our families and friends and constituents are doing their holiday shopping. Our retailers and business owners are relying on the ability to have a secure and safe environment as they are trying to establish and make sure that their businesses thrive and our community members can feel comfortable in doing their activities to support our economy.

I would like to thank Mr. Speaker for not just being present, as I'm sure he will be at some point, but also taking the initiative to create this Select Committee. Retail theft is a concern across the state, certainly is in my district. I've met with business owners and concerned community members who have expressed frustration that nothing seems to be going and that they are at the point of needing to take their own action.

I've seen the desperation in their eyes of small business owners across the City of Oakland, in Alameda and in Emeryville, who have just want to make sure that they can have clean storefronts, that their fixed, broken glasses can be fixed, and that they are not hit again. I've also read the statements of business owners who have decided that the cost of doing business in my district is too much and they've decided to shutter their doors forever.

So this is certainly an issue that we need to be incredibly concerned about. I'm also concerned about the extent to which social media potentially is not fully representing the extent of the instances of crime that we are experiencing or the root cause of that crime.

And I'm looking forward to a very robust conversation to ensure that we're addressing retail theft and organized retail theft in a way that is balanced, that does not rush to conclusions around a particular set of prior policies, and that ensures that we are looking more at the increasing trends and solutions that might actually help all parties involved.

Recognizing that we need to ensure that our police departments are addressing the calls and making the arrest that they need to, that we have business owners in a position to be able to combat the instance of crime that they are facing, that they have the resources that they need in order to be able to fully address these concerns related to security, and that our community feels safe.

So I'm looking forward to a conversation that is robust and does not come to any particular prior conclusions as we engage in this conversation. Thank you.

Thank you, Assembly Member Bonta. Thank you, Members, for joining us today. zero, sorry, Assembly Member Schiavo. I was going back and forth. Me too.

Me too. Thank you. No, thank you chair. I want to thank the chair and the speaker for bringing this Committee together. And it's an important issue in my district, in my community. I've met with a number of business owners recently to prepare for this hearing and really get a good sense of what's going on in the ground. And people are concerned and exhausted and frustrated.

I'm really looking forward to the discussion that we have today to make sure that this is a process that really sheds more light on the facts of what we are facing and can help us really understand what businesses are experiencing on the ground through these meetings with small businesses in our community impacted by retail theft, as well as I met with the DA of Los Angeles to hear about the work that they're doing specifically in this issue and in an effort to ensure everyone in our community, including small businesses, are safe and protected from crime.

I think that it's our job to really focus on the true numbers and real solutions. And so I'm thankful for our panelists who are here today to help us with that process and hoping that together we can identify the root causes of these crimes and look at the data that we can use to develop policies that will have a real impact.

I think it's also important to note that there's been some really unproductive narrative around this issue, both in social media and in the media, whether it's to get clicks and views and whatever else people are going for, and also in the political sphere, for political gain. And I'm very concerned about that, because in the end, the people who are suffering are the people in our community who are not getting real solutions when this happens.

And so I think that our work is to really make sure that we hold criminals accountable, that we address root causes, and that we also hold those accountable who are using this in a way that is for their own gain, instead of actually for the gain of the work that we're here to do.

And so, looking forward to the conversation today, the work that will come out of this Committee, and thank the chair and the speaker again for putting this Committee together and to be a part of it.

Thank you, Assembly Schiavo, and apologies. I was not looking to my left enough. So, first of all, I want to bring the first panel up, if we could come on up to the. So this first panel was intended to provide sort of a level set for Members of the Select Committee and for the public.

And so I'd like to welcome the first panel, which will provide an overview of relevant law data, trends, and to lay a foundation for the conversation to come with us today, I am grateful that we're joined by Caitlin O'Neill from the Legislative Analyst Office, as well as Magnus Lostrom from the Public Policy Institute of California. You each have seven minutes for your presentations. Please proceed when you're ready, Ms. O'Neill.

Thank you. Caitlin O'Neill with the Legislative Analyst Office. I'll be speaking today from a handout called overview of state law related to retail crime that's available in hard copy here in the hearing room with the sergeants, as well as on the Committee's website. Turning to page two, I'll provide a brief overview of how felonies, as opposed to misdemeanors, are treated at certain stages of the criminal justice process.

And just want to mention here that there's a category of crimes that can be charged as either felonies or misdemeanors that are often called wobblers. So at the point of arrest, to make an arrest without a warrant, an officer needs probable cause that the person committed the crime.

But there's generally an additional requirement in the case of arrest for misdemeanors, which is that the crime has to have been committed in the presence of the officer or in the presence of a private person who then delegates their authority to make a citizen's arrest to an officer.

After the point of arrest, people arrested for felonies or wobblers are taken to jail and booked and held in jail until arraignment, whereas the default is the reverse for crimes that are straight misdemeanors, and they are typically cited in the field and released unless certain statutory exemptions are met, such as the person being so intoxicated they could be a danger to themselves or others, in which case people then can be held until arraignment on a misdemeanor arrest.

When it comes to sentencing, I'm on page three now. People convicted of felonies can be sentenced to state prison or county jail and or community supervision, depending on their criminal history and the discretion of a judge. For misdemeanor convictions, people can be sentenced to jail, county community supervision, a fine, or some combination. Turning to page four, we have a brief overview of Proposition 47, which was approved by the voters in 2014, and reduced penalties for certain drug possession and property crimes from wobblers to misdemeanors.

The measure limited these reduced penalties to people who have not committed certain severe felonies, such as murder, or are not required to register as sex offenders, and I'll refer to that population for short as excluded population Prop . 47 also authorized resentencing of people previously convicted of crimes affected by the measure and requires that the state savings resulting from the measure be annually transferred to a special Fund and spent on currency prevention, treatment and victim services.

Turning to page four, Proposition 47 allows its provisions to be amended by a two thirds vote, so long as the amendment furthers the intent of the measure or a majority vote to reduce any of the penalties affected by the measure. The next few pages, starting on page six, provide an overview of what the current legal landscape is on crimes that may commonly affect retail establishments.

So that's displayed in the table on each page, and then the bullets below describe some of the notable changes in law that have led us to where we are with the current State of law. So on page six, we have petty versus grand theft, the two degrees of theft. And under current law, theft of property other than a firearm worth 950 or less is a straight misdemeanor, except for that excluded population that I mentioned earlier.

Other thefts above 950 are wobblers, punishable by up to three years of incarceration. So prior to Proposition 47, the $950 threshold was already in place for many types of theft. However, there were some exceptions, such as if certain types of property, like a vehicle was stolen, or if the individual had certain prior convictions for specific property crimes, they could be charged with a felony for theft under $950, and that was called petty theft with a prior which you may hear referenced.

Proposition 47 eliminated those exceptions for people not in that excluded population. The other piece I'll note here is that there was recently some case law that was codified that allows for separate acts of theft under the 950 threshold to be aggregated for the purpose of determining of achieving a grand theft conviction if they're motivated by one intention, one General impulse, and one plan. Moving to page seven, we have burglary and shoplifting.

So prior to Proposition 47, some instances of stealing from a retail establishment could be charged as burglary, which is a wobbler regardless of the dollar value involved. Proposition 47 created a new crime called shoplifting that involves entering a commercial establishment while it is open and with intent to commit to steal less than $950 or less, and that is a straight misdemeanor. Again, except for the excluded population and prosecutors.

Prop 47 specifies that prosecutors must charge activities that meet this description as shoplifting, so in that sense, it constrained their discretion around charging. Moving to page eight, we have a few more crimes that can affect retail establishments receiving stolen property, which Prop 47 established a $950 threshold there between misdemeanors and wobblers. Organized retail theft, which was created in 2018 and allows for people, essentially, cases where people are working together, to steal less than $950 worth of merchandise to be, in some cases, charged as a felony.

And then we have robbery, which involves taking something by force or fear. Turning to page nine, there's a brief overview here of the California Control of Profits of Organized Crime act, which essentially allows prosecutors to seize assets that have been accumulated through criminal profiteering activity. And finally, on page 10, there is a chart that shows examples of dollar value thresholds for felony theft in other states, as reported by the Pew Charitable Trust in 2017. Thank you, and I'm available for questions at the appropriate time.

Thank you, Mr. Lofstrom.

Good afternoon and thank you for the opportunity to testify today. My name is Magnus Lofstrom. I'm a policy Director of criminal justice and senior fellow at the Public Policy Institute of California. PPIC is an independent and nonpartisan policy research organization and does not take positions on legislation. My comments today draw on PPIC's extensive research on crime trends in California, including those in retail theft and robberies, and they're based on data from the California Department of Justice.

These data can inform our policy discussions on the challenges retailers face. The crime data show that recent trends in retail theft and robbery vary across the state, as well as by type of offense. The data indicated a rise in shoplifting, especially in the Bay Area, and a broader rise in commercial burglary among urban counties. These patterns plausibly contribute to differences in how retailers and residents perceive the problem of retail theft and robberies.

To better understand these challenges, it's important not to limit analysis to shoplifting, a subcategory of larceny. This is especially true for California, where the penal code limits shoplifting to theft below $950, a misdemeanor. As we just heard, higher value retail theft is captured as commercial burglary in the data and can be charged as either a misdemeanor or felony robberies. Incidents of thefts in which force is threatened and or used are more serious offenses.

Those targeting commercial establishments, including Department, grocery and convenience stores, are a subcategory of robbery that can be identified in the data. As with any data, there are important limitations. First, the data currently available for the entire state do not extend beyond December of 2022. Second, the data are limited to incidents reported to law enforcement agencies. Retail theft is likely underreported and especially Low value theft, and this may also change over time. Also, agencies may vary in how they report and categorize an offense.

Lastly, and importantly, the data do not allow specific identification of so called smash and grab incidents or retail theft that is organized. So what do the data tell us? So, beginning with a statewide overview. So I provided a handout. So on page three, there's a figure that I'll start to explain these figures here now and what we see in those.

And starting with page three of this handout, we see that despite a 29% jump in 2022 from 2019, shoplifting remains below pre-pandemic levels by about 8%. However, both commercial burglary and robbery have been ticking up in recent years, and they're up 16 and 13%, respectively in 2022 compared to 2019. Importantly, the data shows that recent trends in retail theft and commercial robbery varies widely across the state.

So turning to page four, starting with shoplifting, we see that in the Bay Area we have the highest reported rates as well as the biggest recent jumps of the 15 largest counties by population. San Mateo and San Francisco had the highest rates in 2022, and rates in these counties increased by 53% and 24%, respectively, compared to 2019. However, we also see in the data that in five of the largest counties, rates fell by at least 20% over the same period.

Moreover, reported shoplifting does not appear to have increased in the state's smaller counties. Commercial burglaries, on the other hand, so this is now on page five, they increased across the state. The data show that commercial burglary rose in all five of the Bay Area's counties that are among the state's largest, varying from a 9% increase in San Mateo to 65% in Alameda. Commercial burglaries also jumped in coastal Southern California, rising 29% in LA and 54% in Orange County.

As with shoplifting, commercial burglary fell in smaller and urban counties. Turning to robberies of commercial establishment, page six, we see that they were up in nine of the 15 largest counties in 2022 compared to 2019, after rising 13% over this period. The state's largest county, LA, had the highest commercial robbery rate in 2022, but the biggest increases among large counties were a 51% jump in Fresno and a 29% rise in Sacramento. Commercial robberies also appear to be on the uptick in smaller counties in recent years.

Insights on what 2023 data might look like may be gleaned from examining monthly 202122 crime numbers. So now we're turning to page 7 and 8, and here I'm going to focus on LA and San Francisco counties as they in particular have received attention for rising retail theft and robberies.

The monthly crime numbers show that San Francisco's increase in shoplifting is driven by a jump from roughly the mid 2021 to mid 2022, and that by the second half of 2022, they were roughly where they were before the pandemic started. Shoplifting in LA, however, has climbed steadily since mid 2021, and by late 2022 it was 10 to 15% above pre pandemic levels. Other large urban counties, such as Sacramento, San Mateo and Riverside also show these upward trends in shoplifting.

However, commercial burglaries and robberies in both LA and San Francisco stayed relatively flat through 2022 above their pre pandemic levels, but no indication of further increases. All right, so are these trends unique to California? So now I'm turning to page nine. The available data is limited to crime data provided by the Council on Criminal justice and is restricted to shoplifting only for 24 large select cities around the country.

As in California, changes vary widely across cities, ranging from an increase of 64% in New York City between the first half of 2019 and the first half of 2023 to a drop of 78% in St. Petersburg. Overall, for all 24 cities, reported, shoplifting is up by 16%. But if New York is excluded, shoplifting is down by 7%, which is in line with California's numbers. So, to conclude, overall crime data indicate that retailers have increasingly been the target of crime.

In parts of California, reported shoplifting incidents rose in the Bay Area, and shoplifting is trending up in LA and some other urban counties. Commercial burglary and robbery increases in recent years are more widespread. Between 2019 and 2022, commercial burglary was up in 21 of California's 58 counties, mostly large urban counties, and commercial robberies rose in 25 counties. Together, these more serious crimes are impacting the counties where the majority of California unslip. Again, thank you for this opportunity.

Thank you, Mr. Chair. Ms. O'Neill, just real quick, you talked about the annual savings that Prop 47 had. It was to do annual savings for our prisons. Do you guys have a number of what the annual savings is?

Yes. So the annual savings, savings estimate for 2022-23 was about one hundred thirteen million and then that amount is what is appropriated the subsequent fiscal year. So 23-24.

Okay, thank you. Just to make a comment, you were talking about people being arrested on retail theft, usually being cited unless they were drunk, intoxicated, and then needed to be arrested for that, and then were then seen arraignment. Do you guys show that for them going into arraignment, or do you guys see them being cited and released once they're sobered up?

I'm just referring to the statutory exemptions. I think it's 853.6. I. Perhaps, you know, that specifies when people arrested for misdemeanors can be booked on a custodial arrest. I'm not sure. I think in practice, perhaps you would have a better.

Yeah, I was just saying in practice, usually because of populations and stuff, normally they get cited as soon as they get sobered up.

So I probably chose a bad example. Apologies, but.

No, I know you're going with. I just wanted to make sure everybody knew what normally would. Thank you. Mr. Lobstrom, you said most likely underreported on some of your stats that you gave. Do you have a reason why they're being underreported?

No, we don't know that. To what extent? I think it's widely believed, and we don't know the extent to which it may be underreported because we don't have information on all actual incidents of retail theft. So that's a challenge in trying to understand this issue and problem got you.

And do you think maybe that's also on some of the stats that you guys collected? Maybe why some of them did maybe drop down or further down because they weren't reported? Is that maybe a factor in that as well?

It's a possible contributing factor. To changes in the reported numbers.

Okay. And just one last thing. The robbery rates you said did increase.

And I'm just thinking outside my head right now, thinking out loud, I'm thinking that's because robberies, they don't underreport those. Those are something that people do want to report. So I'm thinking that's maybe why it increased.

Right.

I think that you're correct that it is a more serious offense. And for more serious offenses, we're likely to see more complete reporting. It's very likely that the victim of this particular type of crime would report it and seek assistance from law enforcement. So, yes, I do believe that it's more complete reporting of that more serious type of crime. Yes.

And I concur. Thank you guys both.

Okay. I'd like to recognize Assembly Member Schiavo and then Mr. Fong and then Ms. Bonta, in that order.

Thank you so much. It is very helpful to get a handle. And I'm sorry if I missed that you explained this, but the difference between shoplifting and commercial burglary and commercial robbery, could you define those again?

Right. So we're using reported crime numbers, and so we have certain ways of trying to create a more complete picture of retail theft and retail robbery. So we can go. And here in California, we're fortunate enough that California Department of Justice provides data that can be disaggregated for the various categories. So when we look at larceny, we can actually identify those incidents that were reported as shoplifting. And shoplifting in California, as we heard, is a misdemeanor. So it would if we simply limit it to shoplifting.

In California, shoplifting is under $950. Is that how you're defining it?

Okay, that's how it's defined according to our penal code. Okay, so it's likely, then, that for those incidents of retail theft that were above $950, they will not be reported as shoplifting. But we can go to the burglary category as well, because it separates out residential burglary and commercial burglary. So this then would be captured in the commercial burglary part of the crime data. So those will be the higher value retail theft.

And then robbery would add on with force.

Now we go to the robbery category among violent crime. And within that, robberies, we can identify those where commercial establishments were targeted for that robbery as well. So that's how we generate a more complete picture of these kinds of challenges.

Okay, thank you. And back. One of the things, I swear that people in my district, the one Bill, they know the number of is Prop 47 or law. But I find that there's a lot of misinformation around this in the narrative in the community. And one of the things that I hear a lot is that under $950, you just can't do anything. And in fact, you can be charged with the misdemeanor. Correct me if I'm wrong, and please jump in.

You can be charged with a misdemeanor which can carry up to six months of jail time. Correct. And now with the new, more recent law, it can be also aggregated so there can be six months for each incident under $950. Is that how it works? Can you explain?

Sure. So you're correct that one misdemeanor for petty theft or shoplifting is maximum six months in jail punishment. However, there's a couple of different things that can happen.

If one person, let's say, is committing multiple acts of theft that can be shown to be one plan, then the law allows those separate acts of theft to be aggregated in terms of their dollar value to achieve a single count of grand theft, which is a wobbler in terms of whether or not how easy that is to do from a law enforcement or prosecution perspective. Like, the workload that that requires is another question that I couldn't speak to.

And then if people are working with others to steal less than $950 on multiple occasions, the organized retail theft law that was created in 2018 could be used to elevate some of those two wobblers. And then I think you had mentioned maybe multiple misdemeanor convictions that potentially could be. Perhaps they could be sentenced consecutively. So at the discretion of a judge, if someone had multiple separate six month misdemeanor convictions for separate incidences of theft.

Okay. And just to be super, crystal clear, though, there are actions that can be taken, repercussions charges, jail time, that can happen under $950 under current Prop 47 law, yes.

Up to six months in jail or potentially, if these other circumstances apply, a felony.

Okay, thank you. And there's also been recent reports about some retailers or national association overstating some of the numbers around retail theft. I don't know if you're aware of that or can speak a little bit about that.

I, too, have heard about that and read a little bit about that, but I don't think I have much more knowledge beyond what's been reported in the news.

Okay.

Yeah.

Are you aware?

Aware, but not in sufficient detail to really comment on it in a meaningful way.

Okay, maybe we'll come back to that. And let me just see if I have one more question. And I assume I know you were talking about pre pandemic a lot. So there's obviously a huge dip, especially in shoplifting during the pandemic when people were not out in store shopping. And so I assume we very clearly can kind of point to that in terms of where the big dip in shoplifting is during those 2020 years.

Correct.

Okay. Thank you.

Thank you. Let's try to keep our questions to about three to four minutes, generally, just so everyone can get actually, before Assembly Member Fong, do you mind if I let Assembly Member Petrie-Norris give a two minute opening statement? I don't know if you want to make some opening comments, and then we'll get back to the questions.

Well, thank you, Mr. Chair. I appreciate your leadership in convening us on this important topic. Like all of my colleagues here today, this is an absolutely top of mind issue that we hear about from constituents almost on a daily basis. I think that in all parts of the state, we've seen retail theft soaring, and it's time for us to take back our shopping centers, our downtowns and small businesses from what I believe is criminal activity that is increasingly organized and increasingly syndicated and increasingly sophisticated.

And I think it's important for all of us to remember that this is not just something that is impacting our businesses, our retailers. This is impacting our constituents. They are feeling the brunt of this in everything from higher costs that they're paying at the checkout to having to feel unsafe in public spaces and in retail corridors. It's also, and I'm grateful that we'll be hearing perspectives from some of our retail workers. We're also increasingly hearing from workers who are on the front line of this.

And folks have shared some really horrific stories and talked about their experience of going to work in the context of experiencing PTSD. So I think it's really clear to all of us that this is a major problem, not just in California but all across the country. I think what is less clear is what are the drivers of the spikes in crime that we have seen and what can we do to mitigate that?

So I am really looking forward as part of this Select Committee to diving into those questions and understanding where is this a California issue, and where is this a nationwide issue, and where can we have policy interventions that can start to shift the balance of that? So I will go ahead and turn it back to the chair. I have a couple of questions for our panelists, but want to let our colleagues go first.

But thank you again to Mr. Chair and to all of our colleagues who are joining us the week before we break for holidays. And I think that's just a testament to how really critical this topic is for all of the residents that we represent.

Thank you. I'd like to recognize, Mr. Fong, if we can try to limit our questions and answers about four minutes apiece so we can get through to everyone. I'd appreciate that. Sure.

Thank you, Mr. Chair. First question, I think, to PPIC is certainly you're indicating some trends, though I think you've highlighted some tension within the data. The caveats that you highlighted are very important caveats. How do we, as legislators and as the public, how do we address the underreporting? I know you indicated to assemble Bershevo just kind of going through the categories, but even within those categories, there could be under reporting as well.

Is there additional ways or additional data that we could collect either through the retailers or through aggregating the amount of loss? That kind of deals with the tension.

Yeah, I think so. But I think we would look to retailers to provide that kind of information. Right. So we can get a sense of what the actual numbers are of incidents of retail theft in particular. As I said, I think the robberies are probably, we're dealing with pretty complete reporting for those types of incidents.

But I think that if we had that information of the actual number of incidents, detailed information on the location as well as well as what the responses were to those calls, for example, to law enforcement, that would be very helpful for better understanding this issue. And it would also provide a baseline to understand the degree to which underreporting is a problem. And it also would allow us to understand if it's sensitive to changes over time as well.

I'm sorry to interrupt, but in terms of your research, have you taken an attempt to kind of try to measure the underreporting?

Yeah, since we don't have information specifically on the number, detailed information on the number of shoplifting incidents that are taking place in a particular location over a particular point in time, we have no way of determining exactly the degree to which underreporting is a problem.

Okay.

And then in terms to the LAO, within the legislatures, there's always been this debate on whether legislative changes have to go back to the voters or whether it can be done through the legislative process and not have to kind of amend Prop 47. In your research and your analysis, what legislative changes have to go back to the voters and what can be done through the legislative process within the Legislature.

So as a general caveat, legislative council would be the best authority on this. But I think generally speaking, the measure doesn't allow amendments that would not further its purposes. So, of course, that could end up being interpreted by a court.

But it seems like, for example, with the organized retail theft bill, that was a case where acts that previously might have been handled as shoplifting perhaps, or could be considered shoplifting are being sort of carved out a little bit because, in fact, they're actually more conspiracy like or in fact, separate from shoplifting on more sort of higher order crime.

It's possible that there could be some cases where you could clarify instances or change processes that affect how people move through the system, also could change sort of laws that affect how those cases are handled in General, like how miss demeanor probation works, for example. But generally, the Legislature would have to go back to the voters to do anything that doesn't further the intent or the purposes of the measure.

I think I follow you. I think that it's one of those issues. I think that within the Legislature, I think we are trying to figure that out. Maybe suggestions to the chair, maybe we have pledge council be on one of a panel in the future and maybe we can kind of flesh out that. Thank you very much.

Thank you. I'd like to recognize Bonta.

Thank you, Mr. Chair. I want to make sure that we kind of have a foundational understanding around the scope of the issue. Some questions were related to some news reports about different information that was provided. Specifically, the New York Times provided information, an article by Mr. Medina entitled Retail Groups retract startling claim about organized shoplifting, in which there is a statement that essentially says, in most major cities, shoplifting incidents have fallen 7% since 2019.

So just one question around can you at least share the information that I'm sure you were privy to reviewing that spoke to the National Retail Federation's claims and overlay that with the data that you provided?

Well, the decrease in 7% of shoplifting is exactly the data that I was sharing. These come from the Council on Criminal justice. They looked at 24 select cities across the country that provide more updated crime data. So they go to the actual sources and download it. It allowed them to look at information that carousels through the first half of 2023. And what they found there was that New York City was where you saw the biggest increase.

And they viewed that as a potential outlier and said, well, if we exclude New York City, with New York City, you have an increase in reported shoplifting by 16%. But if you exclude New York City, there's a decrease of 7%. So it's sensitive to whether you include that city. I think that what is consistent with the data that they're collecting from a variety of cities across the nation is this wide variation in how retail theft is playing out. There are certain areas.

We see it here in California, in the Bay Area when it comes to, and we limit our conversation to shoplifting. Bay Area is an area where we have seen those increases. But as I said, we've also seen a number of large counties as well where there are decreases as well. So there is a wide variation here in California and we see it in the country as well.

Regarding their other numbers that the Retail Association has reported have retracted, I'll let the retailer speak to that and what the underlying reasons behind that are.

Thank you. And just as another point of making sure that we are getting a full picture of all of our data, even in PPIC's report, in terms of the higher incidence of shoplifting or retail theft or robbery, have you done any overlay of the increase in cost of living, the increase in the lack of affordable housing, the general increase in the level of poverty associated with, during these associated times?

No, we have not looked at that yet.

I think it would be helpful for us as a Committee to make sure that when we are looking at robust policies, we are considering all of the potential factors that might lead to increase in retail theft and robbery as something that we do to make sure that we are serving the entirety of the public. And my last question is just I understand the testimony provided here.

Someone who commits multiple thefts, theft crimes in a short period of time already face significant jail time, either from having multiple misdemeanor sentences of six months stacked on top of each other, or from prosecution aggregating the charges into a felony charge. Is that accurate?

Yes. My understanding is that, like you said, misdemeanors could be, in terms of, for the purposes of sentencing, can be run consecutively if there's multiple misdemeanor convictions or multiple acts of theft can be summed in dollar value to achieve a single grand theft conviction if certain conditions are met. I can't speak, so that's reading the law, what it says.

I can't speak to how that works in practice or how much workload, for example, that may take and what workload that then takes away from in terms of how prosecutors and law enforcement are spending their time, but yes, in general.

And then my follow up question on that is, do we actually have any data around implementation practices, why prosecutors are not charging or any means to be able to collect that data. So we actually have a sense of laws on the books. There's an opportunity to do it. Other than general anecdotes around workload issues, do we have a sensibility around what is actually happening in practice, around why prosecutors are not prosecuting and charging?

So I don't have data at my fingertips or really specific data in mind. However, I will note that, as you're aware, the state provided eighty-five million in funding for three years for grants to law enforcement and ten million per year for three years for vertical prosecution, all related to theft, including organized retail theft and the budget Bill. Language on those programs does require some data reporting back to BSCC and also some reporting in the grant applications themselves.

So it's possible there could be some data in there or some interesting ideas for improving data collection that are being tried that could be looked at.

And just to clarify that the grant was dispersed when that was 22.

That was first authorized in 2022-23. But BSEC just awarded it this fall.

Right.

But I believe that data was solicited through the application process and that there are some annual reporting requirements in elements of it not to over promise, depending.

On the reporting on the actual implementation of the grants.

Right. And then I think for the law enforcement grants, it was specified that BSCC was supposed to collect data or that applicants were encouraged to submit data in their application.

So. There might be something there.

I have a few questions. So, on the LAO slides, one of the things I noted on page 10 was that California's $950 felony level looks like it's actually towards the bottom of states where we've got Texas setting a felony level of $2,500. Is there anywhere, either panelists, any way that you think that we might be able to get our handle on whether the felony limit has any relationship to the levels of retail theft?

I mean, we hear a lot of research that shows that it's really not the amount of the penalty, the length of incarceration, but really more an issue of sort of certainty of being apprehended and having a certainty of a consequence. And so a lot of the focus on Prop 47 has been about this $950 level having been changed from what it was before.

So just wondering if, when I look at this data and I see that California is near the bottom, it leads me to think that this is more of an issue about enforcement at the misdemeanor level than it is about the level of the felony line. So just wanted, if either of you have any comments on that.

I don't think there is a very clear picture from research about what the impact of the felony threshold might be. So I don't think that we don't know that particularly well. I do think that you're absolutely right in pointing out that it's not the length of the sentence that tends to have an impact on the likelihood of someone committing one of these crimes. It's the likelihood of being apprehended and facing consequences of that.

But there hasn't been really any research trying to assess how that likelihood has changed here in California, for example, as a result of Prop 47. So I don't think that we're in a place at this point in time where we can say exactly what the answer to that question is.

Thank you. I keep hearing over and over again that some of the problem are these organized rings of people repeatedly going to stores. And really you can sort of look at a route where you sort of see the stores hit repeatedly over a period of time. Is there any data to support that? I mean, do we have any data that sort of shows what the profile of these robberies and the shoplifting looks like?

Unfortunately, we don't. The currently available data doesn't include that kind of detailed information where we know where a reported incident, where that actually took place. So that means that we can't really determine whether a particular area, a particular store has been targeted multiple times. So currently available data do not allow us to answer that question either.

If I may, it's possible that CHP might have some of that data in terms of cases that they've been involved with, given they're part of these organized retail theft task forces that the state has been funding. So there could be some limited data there. Also, the crime of organized retail theft itself, it's possible you could get conviction data for that. But as Ms. Bonta noted, there's a lack of data in general in the criminal justice system in terms of how cases are processed.

So we may know how they ended up in a conviction, but we may not know where they started out or geographically where they occurred exactly, et cetera. But there are some additional pieces of data that we may be able to triangulate from or that as data begins to flow in from these efforts that are underway.

Thank you. I think my last question has to do with the issue of shoplifting going down in California. And actually, my sense is shoplifting, we're talking about the national numbers. We're talking about a lot of different things being mushed together in one category. So shoplifting that may include shoplifting going down in some states where it's not actually shoplifting in California because the data is whatever each state considers shoplifting. Is that right?

So does that mean we should be focusing on really what the data is in California?

I do think that we need to be careful because it's not clear how things are being reported by the various agencies and what's being captured. When we define it as shoplifting, we do know that when we do that in California, we're likely to only capture those relatively low value incidents of retail theft that are $950 or below. So, yeah, I think that there are difficulties in making comparisons unless you have a more complete picture.

And unfortunately, when you're looking at these other cities, even where data was collected by the Council of Criminal justice, it doesn't go beyond shoplifting. So it doesn't look, know the burglary category, for example, on commercial burglary as well, then that could generate a more complete picture and potentially then more comparable data across states as well.

Great. And then my last question I'm going to ask somebody, or Petrie-Norris, I know has a question or two, the $950, the shoplifting statistics, which show that it may be going down in some places. I hear various things about that. One contention is that it might be going down because shoplifting isn't being reported or isn't being prosecuted. And then others are basically saying, well, the data is showing that it's going down over time.

And so I was wondering if you have any, can shed any light on how we can determine what is actually happening?

Yeah, I think it's a really good question, and it's important that we get that kind of information. I think when you start to look at the data, when you see these very different patterns across the counties or the cities across the state, what it's telling us is that you just do have very different patterns, and if you do aggregate them together, you might actually not detect those things. You also have to look at it very closely. LA is a very good example of that.

If we look at it for shoplifting, for example, you look at one of those figures. When I do a comparison between 2019 and 2022, it's showing a decrease in reported shoplifting between 2019 and 2022 for LA. But when you start to look at those monthly crime numbers that I also provided the Committee with, what you're seeing is there's a gradual increase in reported shoplifting in LA over a year and a half long period.

And that by the end of that period, you're actually seeing levels that are higher than they were before the pandemic. You know, the data are capable of showing some indication of some increases as well. We saw it in the San Francisco data. We see clear evidence of sudden increases around the mid 2021 in reported shoplifting incidents and higher levels that were sustained for a period of time and then decreases as well.

So I think one opportunity is to look at situations like in San Francisco, and I was happy to hear that you'll have a hearing there because I think that there are potential lessons to be learned from that situation. We see a relatively sudden increase, notable increase over a short period of time to see if we can determine what is behind those increases. And then importantly, we're also seeing a relatively sudden decrease in reported shoplifting in San Francisco.

What were the responses and the changes that took place in San Francisco that might have led to those decreases as well? So I think it's, looking at it in those individual jurisdictions might provide us with some important answers that will help us better address this challenge.

We've got about three minutes left for this segment. I want to let Assembly Member Petrie Norris ask her questions.

Well, thank you, Mr. Chair. And I do think that as we dive into this policy area, it's absolutely critical for us to start with a foundational understanding and a shared set of facts. So appreciate both of you being here to try to help us establish that.

There were really two pieces of data that jumped out at me, and one was actually what our chair drove home, which I think was a surprise to me, and I imagine many of us, there's been a lot of discussion and debate around the Prop 47 threshold. Is that what's driving this? So I think to see that California's $950 threshold is actually one of the lowest in the country is really important. And then second, Mr. Magnuson, am I saying that right? Lostrom. Sorry. Mr. Lostrom.

So one of your first slides shows the retail theft and robbery rates over recent years. And I think the headline says rates of retail theft and robbery have risen in recent years. But if I'm reading this correctly, at least for the time horizon on this chart, like, we're looking at an all time high when we look at commercial burglary and commercial robbery. Is that accurate?

It's not an all time high. We can go back to the 1990s, and you're going to see definitely higher rates in those periods. So in recent, over the last decade or so, yes, they are.

Do you have any hypotheses around what is driving sort of here? It looks like we're seeing like a decrease in petty theft, a decrease in shoplifting, and then the commercial side of things just continues to go up. Any hypotheses around what's going on with that?

We're looking at the pandemic years. We're looking at substantial social disruption, how we lived our lives, where we were. We had, you know, stay at home orders issued. What it means is that there are fewer people who are out on our streets, fewer people who are actually going to various stores. So there's less traffic at the stores. That's likely to contribute to less shoplifting as well.

On the commercial burglary side, it's possible that those are actual burglaries as well that are contributing to that during that period of time. We do see, for example, in 2020, if you look at the monthly data for LA, for example, you see a very big jump in commercial burglaries in the midst of 2020 in June. And that's around the protest in the wake of the murder of George Floyd. And so that's captured also in those kind of numbers as well that might have contributed to that.

You are seeing different patterns there. I think when you're looking at the commercial burglary side, you're just seeing kind of a gradual uptick over the last few years that are pointing towards, when we're looking at the higher value retail theft, the data is pointing towards increases there. On the shoplifting side, we see some bigger fluctuation.

And one concern to me at least, is changes in reporting as well for these lower value incidents as well, that in some incidents, retailer might feel like it's just not worth it. This was just, I just lost, whether it was a six pack of beer or something like that, I'm not going to report that. So especially if there is a sense that this is a pretty prevalent kind of situation and the consequences may be limited as well.

Great.

Thank you.

Okay, in the interest of time, we're going to transition to the next panel. I would like to thank both of you. Thank you so much for giving us part of your afternoon today to help us understand this issue. Really appreciate it. We can call the next panel upload.

Welcome the next panel. Second panel will feature perspectives from retailers, workers and property managers. And so very grateful to be joined today by Rachel Michelin from the California Retailers Association. Welcome my good friend Amber Parrish Bauer from the United Food and Commercial Workers Western States Council. Welcome Amber and Jeff Kreschick from Federal Realty. Each have six minutes. And so Rachel, please proceed when you're ready.

Good afternoon. Thank you for the opportunity to speak with you about retail theft, and we really want to appreciate Speaker Rivas and your commitment to focusing on this issue. We think it's very important and appreciate you chair Zbur on bringing all of us together to have this conversation. I was recently asked if retailers in the media are overhyping the problem of retail theft. The fact is that retailers are faced with many challenges doing business in California.

But the issue of retail theft has clearly grown over time, and its impact has called retailers of all sizes to take measures that we would not have considered years ago, whether locking up products, employing off duty to police officers and security guards, putting patrol cars in parking lots. Retailers are utilizing whatever tactics we can to deter retail theft to protect employees and customers from harm. So the short answer is no. Retailers are not exaggerating the problem of retail theft.

Recently, the Sacramento County Sheriff's Department shared the results of Operation Bad Elf. This is a great example of the type of operation that sheds a light on the impact of retail theft in our communities. Over 10 retailers participated, resulting in over 285 arrests and 78 felony charges. Of those arrested, 20% were on probation or parole and 65% had previous arrests for alleged violent crimes. On Tuesday, November 28th, the San Francisco Police Department conducted its first of two preplanned shoplifting enforcement operations.

Blitz 23 focused on one store one day, and it resulted in the arrest of 17 suspects, two of which had outstanding warrants. On Tuesday, December 5th, a second shoplifting enforcement operation resulted in the arrest of seven individuals. Three of those had outstanding arrest warrants. Many retailers of all sizes have reported that store leaders have been told by law enforcement not to report retail theft incidents unless there is a threat of violence against an employee or customer.

Some retailers do not call law enforcement for every instance of shoplifting due to the volume of theft happening, and others have been threatened with citations of public nuisance if they continue calling law enforcement. One California retailer noted that during regular hours of operation, retail theft is happening every three minutes across the state. So this leads to the burning question of data.

While we know some retailers have internal policies to not call law enforcement for every single incident, we also know law enforcement may have internal policies on what crimes they will respond to. This creates a patchwork of policies that vary from city to city, law enforcement agency to law enforcement agency, which leads to skewed data on the real impact of retail theft.

CRA was proud to collaborate with the Newsom Administration on the governor's real public safety plan, which included securing the $267million in local law enforcement grants allocated specifically to combat retail theft. And we will continue to work with law enforcement on policies that can help streamline the reporting process that can result in better data. But individuals committing retail theft have used acts of violence, including weapons and setting fires to stores, to create a distraction.

Preventing retail theft and protecting retail employees and customers is the top priority for all retailers in California. Just let me repeat that preventing theft and protecting our employees and customers is our top priority. The growth of retail theft and the damage it causes communities dictates that something needs to be done to ensure there are consequences to prevent this criminal behavior from entering our stores and deter it from continuing to escalate.

The California Retailers Association is looking to work with the Legislature on several reforms that we believe can help curtail retail theft in California. Specifically, along with our partners in law enforcement and local governments, we're advocating for the following first, targeting repeat offenders Penal code 666.1, which you heard about earlier. Petty theft with a prior was removed with the passage of Proposition 47.

Reinstating this section would need to go back to the voters, so we implore the Legislature to act fast to ensure California voters had the opportunity to vote on this issue on the November 2024 General election ballot. Aggregation, understanding there are constitutional limits to adding values of multiple thefts committed by the same person. We are advocating for clarification in the Penal code that multiple thefts can be aggregated into one total value to trigger the $950 threshold multi jurisdictional prosecution.

Last year, AB 1612 was signed by the Governor, but was significantly watered down in the Assembly Public Safety Committee from its original intent. We are advocating for the original language of the bill to be considered for reintroduction, which would make it clear that DAs and city prosecutors have the authority to prosecute incidents where the same individual has committed theft both in their jurisdiction and outside their jurisdiction, and then organized retail crime.

Penal Code 490.4, which is the current organized retail crime statute, is set to sunset in 2026. We are working with stakeholders on legislative proposals to strengthen the statute and advocate for various changes to increase the ability to prosecute under this section, such as removing the requirement that law enforcement must prove intent to steal and attempt to sell for each incident. We believe the act of stealing should be sufficient. Today in California, retail theft pays, and it pays well.

It is viewed as a low risk, high reward venture with little consequence if someone is caught. But now is the time to change that narrative. It's too important for California consumers, our retail employees and the communities we operate in. Thank you for the opportunity to share the retail perspective. I look forward to any questions.

Thank you very much. Amber.

Amber Bauer I'm the Executive Director of the United Food and Commercial Workers Western States Council. Thank you for inviting UFCW to be a speaker here today and to share the worker perspective on organized retail theft. The UFCW is a 1.3 million member strong national union with 180,000 workers in California. We represent the food, drug and retail industries. We are dedicated to upholding a set of core values that reflect our commitment to the safety of our members and the communities we serve.

Retail workers are facing impossible workplace conditions without the proper training and safety measures. They are on the front lines of the crumbling social safety net, mental health crisis and an addiction epidemic. The rapidly increasing prevalence of retail theft as an issue has created a workplace safety crisis among our members and our customers. Our leaders hear stories daily related to the violent incidents of organized retail theft in our store, but currently there is no requirement for mandatory reporting or tracking by employers.

I'd like to share a few stories from members and their traumatic experiences they have faced with organized retail theft. In San Jose, a Safeway employee was shot and killed during a robbery inside the store. There was an altercation between the Safeway employee and an assailant who was in the alcohol section stealing liquor. In another incident, two men came into the Rite Aid store in Eagle Rock to steal beer.

As they were leaving the store with several cases of beer, the cashier approached them to ask them to pay for it. One of the men pulled out a gun and shot the cashier in the chest. The cashier died in the arms of his coworker while they waited for an ambulance to arrive. A Safeway security guard in San Francisco was shot and seriously injured when they attempted to stop a shoplifter who was attempting to steal alcohol. This left workers at the store scared to go to work.

They were threatened by the nature of the shoplifter and they are now considering working in non-retail industries. The only tracking of these incidents that is currently required by employers is through the Calsha 300 logs. But those logs are limited in the information they capture because they only track when a worker has missed time away from work, has been hospitalized or killed on the job.

They don't track incidents where workers have been threatened with a gun or knife, assaulted or threatened, verbally or assaulted, but didn't need to be hospitalized. To address this data gap, UFCW sponsored Senate Bill 553, which was authored by Senator Cortese this year that, among other things, will require employers to record incidents of workplace violence in a violent incident log.

The Bill will become effective July 1st, 2024 and will allow for much needed data collection on these incidents, the classification of circumstance at the time of the incident and the consequences of the incident.

UFCW believes this is a strong first step to get data on the types, frequency and circumstances surrounded organized retail theft to move forward protections for workers with a focus on data driven solutions, an effective strategy that big box retailers are implementing that UFCW has been urging signatory employers for years to implement as a deterrent to organized retail theft is higher staffing levels in the stores, full service cashier lanes and security staff at entrances.

Best Buy has employed this strategy at a thousand of their stores, according to a recent CNN Business News article stating that, quote, it has shoplifting under control, end quote. But Best Buy isn't the only big retailer that also utilized these methods. Lowe's has also invested in more human capital to reduce shoplifting and organize retail theft. Additionally, Lowe's has spent a lot of time training employees.

These strategies have led Lowe's to have an inventory shrink of over 1%, which is on the low end of the typical industry range, and the losses from retail theft this year are not expected to have a material impact on company profits. Unfortunately, this is not the case for the vast majority of retail chains.

In recent years, we have a reduction of staffing levels in our stores, more automated services, typically in the form of self checkout, and shifted responsibilities onto employees and customers to save money and boost profit margins. Companies that use self checkout lanes and apps have a loss rate of about 4%, which is more than double the industry average. Thinly staffed stores and more checkout lanes adds risks of organized retail theft and theft in our stores, according to John Eck, a criminologist at the University of Cincinnati.

Quote, 'the more retailers go towards reducing labor costs and putting more of their energy on shoppers, the higher the shoplifting', end quote. Crime prevention experts urge more retailers to adopt these practices to deter shoplifting, and UFCW agrees. In order to improve worker safety in stores and reduce organized retail theft, UFCW urges employers to significantly improve staffing and even consider mandatory minimum staffing levels eliminate or reduce the use of self checkout machines and prohibit certain items from being purchased through self checkout and provide effective worker training.

Lastly, incidents of organized retail theft, especially those involving the use of a weapon, are very traumatic experiences for our Members. We strongly urge requirements for employers to provide traumatic care to workers. This could include making individual trauma counseling available to affected employees, time off of work, and conducting a post incident debriefing. Thank you for allowing me to testify and welcome questions at the end.

Thank you Mr. Kreschek, good afternoon and thank you for the opportunity to speak today. My name is Jeff Kreschek and I'm the President of the western region for Federal Realty Investment Trust. As I'm sure you're not familiar with federal realty, we are the owners and operators of 102 shopping centers encompassing 26 million sqft nationally, including properties such as Santana Row in San Jose, East Bay Bridge center in Emeryville, Oakland and properties in Santa Monica, Hollywood, El Segundo, Bell Gardens and Watts.

Within our national portfolio, we have approximately 3300 retail tenants with properties across the country. We've had a unique view of consumer behavior, shopping patterns, retail operations and decisions, and elements of strong communities. With the highly publicized crime issues, we find ourselves at a critical crossroads as an industry. Consumers have more choices today than ever before and the only true differentiating factor is the place.

Unfortunately, when the place itself is perceived as not safe, be it the store, the shopping center or the city, it pushes consumers to other avenues for shopping and pushes retailers to make alternative decisions as to where they locate a store. While the current environment relative to organized retail crime is a national issue, the issues we are facing in California are pervasive and more pronounced than it is in any other state where we own property. That is not an exaggeration.

California is simply the most difficult place for retailers and owners to safely operate stores and properties. As you know, inventory loss in 2022 reached $94 billion and over 75% of retailers reported some sort of organized robbery resulting in property loss and or physical harm to employees and shoppers. It is expected that the full year 2023 numbers will be significantly worse.

These organized criminal entities are not focused on any one particular type of shopping center or retailer, but rather are opportunistic and willing to take anything that is easily available and readily sellable on the black market and on traditional resale websites, all without consequence. The issue of theft, referred to as shrink, has been a consistent theme on recent corporate earnings calls from retailers across the country.

As just one example, a major national tenant reported 120% increase of theft incidents involving violence or threats of violence in the first five months of 2023, the disappearance of merchandise caused a 400 $1.0 million hit to that retailer's gross profit margin for the year alone. Another national apparel retailer shared that volume of their theft in California stores is more than double the volume of that in any other state.

The frustrations that this retailer shared were mainly pointed at the lack of prosecution that has forced the retailer to close several stores already this year. These are just a few examples, but a consistent theme for most every national retailer. Even more troubling is the trend as it impacts local, smaller tenants who are not as fiscally resilient as the national retailers.

With such dramatic fiscal impacts, concerns over employee safety and a General belief that many municipalities are simply not interested in prosecuting retailers are reconsidering new locations and in some cases, closing stores and related operations. The consequences of this would be devastating to the labor market, tax revenue, homelessness, and the overall health, safety and economic stability of our communities. What started as isolated instances of individual shoplifting has now grown into organized mobs, with targeted assaults on retailers spanning from luxury to daily needs.

As the number of incidents has grown, so too has the brazenness and violence associated with these targeted attacks. The criminals and criminal enterprises behind the robberies have little to no regard for the safety of shoppers or employees and have been emboldened by not only the lack of intervention on site, but the clear understanding that if caught, there will likely be little to no consequences.

Between the misguided policies of Proposition 4757 no cash bail, and the failure of local DAs to actually prosecute crime, we have created a microculture of anarchy and mayhem in which the basic rules of a civilized society do not matter. Criminals are very much aware that store staff and onsite security will not physically engage and could do little more than observe and report for fear that their own lives could be at risk.

Retailers and property owners have been clear in their warnings to employees that their lives are not worth the risk to protect the merchandise. Police cannot respond fast enough, and law enforcement clearly understands that even if they could catch perpetrators, the local Das will likely refuse to prosecute or retailers themselves will decline to press charges. These failed policies now serve a small population of criminals in our communities and impact the much larger populations that depend on the environments and employment that the retail establishments provide.

And so the broken system chugs along with everyone passing the responsibility for where we are to someone else, all while the lawlessness continues with real impacts yet to be truly seen. Unfortunately, the real impacts are now making themselves very transparent. In September, Target publicly announced it was closing nine stores, including three in the Bay Area, as a result of major retail theft. I cannot speak for Target, but I can assure you that these decisions were not made lightly.

And more importantly, once they are made, they are irreversible. They are permanent. There are countless other retailers who are either closing stores or choosing simply to reevaluate opening stores in areas such as Oakland, San Francisco and parts of Los Angeles simply because of safety and crime concerns. While critics will counter that the stores were underperforming and that retailers are hiding behind organized retail theft as a rationalization to close stores, the stores are closing nonetheless. So let's discuss the true impacts of these closings.

First, you have the obvious loss of jobs. These jobs tend to be hourly employees who are most in need of stable employment and are most financially vulnerable in our communities. While a small convenience store may only employ two to four people, the number grows exponentially as the size of the store does.

As a 10,000 square foot retailer who recently informed us that they plan to close their store two years early simply due to the shrink in store shrink and for fear of the safety of their employees, employs roughly 30 people on a full and part time basis. About 30 seconds when that store closes, 30 people will lose their job in that community, and all are part of their health coverage that's associated with that employment.

Second, you have the clear loss of goods and services in the area that communities have little viable retail in their communities to start with. In one such community, where we have a grocery store, the shrink has gone from 1% to 8% of the total sales. That's impossible to sustain for a business that typically operates on a 2% profit margin.

There's much more, I'd like to say, if time permitted, but at the end of the day, this is a very real problem that is going to impact the communities in substantial ways that will be here for decades following the closings of these stores. When these stores close, the communities will suffer for a long time. Thank you.

Thank you very much. So I'd now like to recognize Mr. Speaker who wanted to make a few comments.

Yeah, thank you for that. Assembly Members Zbur and I have a whole bunch of scribbled notes everywhere, so just ask that you bear with me, but want to thank first Assembly Members Zbur and Bonta, who reached out to me early this summer to highlight the issues and the concerns occurring in their districts and the need for us to take this issue seriously and to ensure that we're doing all we can to tackle this issue.

And so certainly thankful for all the Members who have prioritized this issue and made this a priority to be here, especially on December 19. I'm sure there are a lot of other things that many of us would like to be doing, but here we are in the Capitol to have this conversation and appreciate all of you who are here to engage. And certainly what I appreciate, a question that Assembly Members of Zbur asked at the start of this hearing, is does perception match reality?

And does that distinction matter? And it does matter. It matters because it's important as a Legislature. It's important for me as I enter my 6th year in the State Assembly, and I'm sure for many of my colleagues, it's important that we preserve our successful criminal justice reforms. But at the same time, we need to ensure that we are delivering solutions for business owners and consumers, especially when it comes to this issue of retail theft.

And look, I have been to all parts of California and in large cities, small cities, in our rural communities. Retail theft is a top concern all parts of California. It's a top concern because one I've engaged with residents who have witnessed or know someone who has witnessed a retail theft incident in their community. They are either cite these sensationalized incidents that are all over social media, that have been broadcast by major media outlets.

But more so than anything, everyone is noticing the changes in routine shopping experiences when they go and buy some deodorant or laundry detergent. It's under lock and key. And so certainly the concern is very real. And something that caught my attention was an article this morning in the, you know, at the onset of that article, they cited this Home Depot chief Executive who suggested to viewers on Fox Business that a surge in shoplifting by organized gangs showed that America was descending into a lawless society.

And I could not disagree more with that. Know.

And that's not to say that everything is okay. It's not to say that retail theft isn't a problem here in California. And that is exactly why we are here, is to have this discussion, to engage with stakeholders. And my expectation is that my colleagues, this Committee, will act with focus and urgency to find solutions that work for California. And we know this is a problem. We know that there is a gap in data. And so I get back to that question asked by Assemblymember Zbur.

Does perception match reality? And I look forward to finding those answers and to working with you all on solutions. But couldn't thank my colleagues here enough, appreciate their commitment on taking on this critical issue. Mr. Zbur, thank you.

Thank Mr. Speaker. I mean, I think his attendance here demonstrates his commitment to really looking at this issue, digging deep and understanding what we need to do to protect our consumers, our workers, our businesses and our small businesses in California. And I want to thank the speaker for joining us today. Very grateful with that.

If anyone can put their microphones down, unless you want to speak, and then what I'd like to do is first recognize chair McCarty, and then I'll go to Assembly Member Ortega, who has not been had the opportunity to ask questions before.

Yes, thank you. I have a few questions for our retailers, and I have many more in the next panel for are really the overarching issues in practice in our district attorneys and our police teams. But you represent Retailers Association in California. And granted, we have retailers across the country.

One of your affiliated Members here talked about. So how do you reconcile, we're fixated on this dollar amount in Prop 47, and as Petrie Norris mentioned earlier, California is one of the lower ones, and other states have sometimes double that. And how do you reconcile how that dollar amount impacts the problem we have in California with retail theft?

I'll say we're not necessarily fixated on the dollar amount. And I'm going to use Texas as an example because I think someone brought up Texas at $2,500. You have to read the statute. They have petty theft with a prior. On your third retail theft, you're going to prison. Prison, that's in Texas. Right. So when you're looking at those numbers, it's a little bit a misnomer on the dollar amount because you have to also read the stat, which I've done. You have to read the statute.

We don't have petty theft with a prior anymore in California. And so for know, we've never advocated for changing the threshold. Other folks might have done that. We've never done that. We've advocated for two things in the Legislature in the past two years, aggregation and petty theft with a prior. If we could bring back something like petty theft with a prior or the aggregation up to that $950 threshold, we think that would do a lot to deter it.

But just to look at the numbers, you really need to go back and Texas was one that was brought up to me a couple of years ago. I went and read the statute from the Texas penal code, and that's the difference. And so while you can look at the dollar amount, you have to make sure you have the policies to be able to have that consequence for behavior. And unfortunately, we don't see that happening right now in California.

Okay, so a second follow up to that is, I know today we're talking about the problem legislation. We'll get there eventually. Right. But one of the solutions is accountability. And we heard earlier from PPIC Director that it's not the dollar amount or anything else. It's the risk of being caught. And so in your eyes, the threshold outside, is there a minimum threshold for a prior.

So if you had prior and you're a petty theft and you come in there and take a water bottle, which is now $3, so what do we think about that?

Look, our goal is not, we're not looking to throw people in jail. We just want them to stop stealing. We want them to stop coming in. We want them to stop putting our employees in harm's way, putting our customers in harm's way. So to your point, we're not looking to throw people into jail for stealing a water bottle. We would absolutely entertain conversations around what does that third or fourth petty theft look like? What is that dollar amount? Absolutely.

We also look at this as an opportunity for intervention. I think my colleague up here talked about we have people coming into the stores with mental health issues, we have people coming in with addiction issues. We have people coming in that need some of these support services, and we could use retail theft as an opportunity to be that intervention. Point. Both of the pieces of legislation we sponsored in the last two years, both on the petty theft side and the aggregation, include pre plea diversion programs.

We would rather see people going into programs to get help. In addition, we also then offer a job training program because many of the retailers, we were the first industry to ban the box. We welcome people with some criminal back with criminal histories to come work in our stores. We were going to couple that with job training programs. Part of the challenge we have on staffing levels, we can't get people into the stores to work. So we're constantly figuring out how can we do this?

And we think there's some unique opportunities that we can work collaboratively on finding solutions. But we have to remember this is criminal activity coming into the stores and we have to figure out a way to deter that. And right now there isn't that deterrent. The perception is, and many of you talked about perception, you can walk into a store and walk out and there will not be a consequence. But what's worse to me, and this just came up last night with my 15 year old daughter.

I was on a call yesterday with some small businesses who talked about how kids are going into stores and walking out with bottles of alcohol and selling it at parties. So I asked my daughter, who's in high school, have you heard about this? Oh yeah, mom. Happens all the time. They go into the grocery stores. They're not stealing because they are in need. They're stealing because they know they can get away with it.

So not only are we dealing with a criminal element of people in these organized crime rings or these shoplifting rings, but now we're training a whole generation of kids that it's okay to steal. One idea we've had, and I've talked to some policymakers about, there should be something like traffic school for your first infraction on retail theft.

When my older daughter got pulled over after she got her license, the worst thing that ever happened to her was having to spend 8 hours online in traffic school that deterred the behavior. So what are things that we can start doing to help deter the behavior from happening in the first place?

But I think that has to be part of a broader conversation that these individuals who are repeat offenders, and you talk about stores like Target who close their stores, it's because of the repeat offenders coming in. We also have to deal with that element as well and then know we.

Talked about earlier in Sacramento, the operation bad elf, and our former colleague and our sheriff likes to talk about this topic. So he brought up a point that some of the retailers aren't, even though there's inefficient opportunity, many would argue with the misdemeanor felony differentiation, some retailers aren't allowing arrests to happen in the stores because of perception. They don't want to have a bad video that goes on TikTok and so forth.

How would you respond to that and what retailers are or not doing allowing local law enforcement to help stop this in the first place?

Yeah. So you'd have to talk to the individual retailers and their policy directly. But I will say this, our number one priority is the safety of our customers and our employees in the store. And you talk about some of the things related to trauma. It could be very traumatic if you have law enforcement brazenly coming into a store and starting to arrest people. Think about the mom shopping with the five year old or teenagers in the store maybe doing their Christmas shopping.

And so I think there has to be a balance to that. We're open to having conversations with that. But I do think the same token, I have a store here in Sacramento that is being told if they continue to call law enforcement, engage law enforcement, they're going to be cited as a public nuisance. So it almost feels like the retail industry.

The other thing I want to point out is we focus a lot on the big box stores, but I got to tell you, the people I'm hearing from the most, I was on a call yesterday with a number of small business owners in Oakland calling me saying, we need your help because it's our small retailers who are being hit constantly. These group of retailers told me, Rachel, if we can't get some real change happening in the Legislature by April, stores will start closing in Oakland.

And to your point, you don't get that back. So I think there's a lot of conversations that can happen, and that's why we continue to partner, particularly with the Police Chiefs Association and the League of Cities, on how we can work collaboratively to find these solutions.

Thank you. Okay. Let's try to keep our questions to around four minutes, and I'd like to recognize Assembly Member Ortega, who's been waiting patiently.

I will be very brief. So this question is actually, well, I want to thank first of all, Ms. Parrish Bauer for sharing those heartbreaking stories. I mean, one thing to keep in mind is that what we're doing here is not just saving money, but also saving lives and really thinking about those essential workers who are at the front line every day. So thank you for sharing that. My question is directed to Mr. Krenshek Kreshik. Okay, so I'm trying to understand.

There was a comment made about retail theft pays. So what is happening to the merchandise once it's stolen? That's leading to people going in, taking bulks of things and then selling it somewhere. So I started looking around and ran into an article where I want to quote one of the pieces in there. It said in 2021, a law enforcement officer told the Wall Street Journal that Amazon is the largest unregulated pawn shop in the country.

I've also heard that places like Facebook Marketplace are selling things that look like stolen goods. So my question to you is, would regulating Amazon or other large media sites curb or deter the sale of stolen retail goods?

Without a doubt, if you take away the marketplace where these goods can be sold, they have no value any longer. Taking on Amazon to curb that's not a small task I hope you can appreciate, but is that part of the solution? Absolutely. You have to take away the vehicle through which this merchandise gets resold. If you don't do that, anything you do do on the criminal side will be worthless because it'll still be sold and it'll still be stolen.

It's just going to make it a little harder to steal. But if you don't make it harder to sell, you're not solving the problem.

Can I comment one moment? Because there was legislation that was passed, Senator Skinner's Bill, SB 301, that was signed by the Governor, which was the Informed Consumers act, that actually does do what you're talking about, provides more transparency and guardrails. California passed it, and then it was used as the model to pass at the federal level. So they just took effect July 1 of this year. So there are those guardrails that we're starting to see some things happening there. And it's not just on that.

I mean, there's multiple, these online marketplaces open up constantly. It's hard to keep up, but we are making progress. And I was thrilled that we were sponsors of that legislation. We worked with the Newsom Administration on that, and it did become the model nationwide to make sure we can combat those theft rings selling on the online marketplaces.

So, Mayor Bonta, were you finished? No. Go ahead.

I appreciate that lot, but clearly there's still loopholes in there that need to be addressed, and hopefully we'll get some data once it is actually implemented. I'm hoping once we have further hearings, that that's actually something that we focus in on, because, again, they're going somewhere, and it's an area I really want to work on. So thank you.

Thank you, chair. And I want to thank the panel for actually raising the concerns from the business owners in Oakland that I actually spent time with over this last weekend and have previously, as well, understanding their concerns. One of the issues that we did talk about, and the panelists raised as well, was this idea that we've actually been able to invest close to $270,000 through two different grant programs administered by the BSCC related to organized retail theft.

I wanted just to kind of make aware, for the sake of my fellow colleagues, that those grant programs were incredibly oversubscribed. The BSEC will note that they had over $300 million in requests associated with that. And there are 76 police departments, county sheriff's offices, and District Attorney's offices throughout the State of California who applied for the grant and did not award it.

So as we're looking for additional solutions, I certainly hope that we will continue to be able to invest in making sure that we have local counties able to address these issues around retail theft in a way that is actually supportive of the problem that they are trying to solve. The previous panel did talk about the fact that we're not really clear on by county what the nuance is causing the level of theft or the kind of theft that we need to.

And so while we're state legislators, every nail looks like a hammer. I do think that one of the things that we need to focus in on is being nuanced enough to provide county level support and making sure that we are continuing to provide the funding, adequate funding, to be able to support these efforts at the local level.

Thank you. I'm going to call on something, Mayor Pacheco, since she hasn't spoken yet, and then I'll go to folks on the side of the room.

Thank you. And thank you for participating in this panel today. I had a couple of questions. One of them has to do with retail theft being sold online. I actually seen an incident in LA in which it was actually being sold at a storefront. So it was actually being sold in a location over in the City of Los Angeles. And I'm curious as to whether we're seeing this more often, that there are now storefronts opening in which we are seeing stolen merchandise being stolen.

I mean, being sold.

We have not seen that, but I'm sure it exists. The good news about that is it's pretty transparent. If somebody is opening a storefront to sell stolen merchandise, it's usually pretty easy to identify and pretty easy to shut down, and it's hard to hide a storefront. So they pop up here, they pop up there, they're pretty easy to make them go away.

And I heard that the location of this storefront was Macarthur Park. I don't know if you're from.

Macarthur park is a whole.

Yeah, that's a whole other story.

You want to talk about how to stop the selling of stolen goods, close down Macarthur Park. I mean, that would solve LA's problem in about 90 seconds.

Yeah, absolutely.

And then I hear a lot of the same theme, which is related to consequences, and there was a comment made about the DA's office not filing on certain cases. And throughout the State of California, every county has a different DA. So are we seeing different filing rates throughout the State of California and different amongst the different counties within the State of California?

Yes. We know they all run their own programs. And so you are seeing things that are different. That's why we're also looking at the multi jurisdictional legislation that Assemblywoman Irwin had last year that was watered down, because we do see that certain counties will prosecute more than others, and that goes back to deterrence. If people are going to know that there's going to be a consequence because they're going to be prosecuted, then that helps deter the behavior. And I think the theme has to be deterrence first.

Right. And when people see that, then they know that there's going to be accountability. But when you have certain parts of the state where they know they're not going to be prosecuted, that's where people are going to go, because they know they can get away with it. So it's very inconsistent throughout the State of California.

Okay, thank you. Thank you, Mr.

Chair. Assembly Member Schiavo.

Thank you, Mr. Chair. So I wondered if you could talk a little bit about the retailers, what kind of data that you collect, because it seems know, especially in the previous panel, there's a lot of questions still out there when we look at the data and a lot of gaps, and I imagine that retailers pay a whole lot of detailed attention to what is happening in their stores. Is that shared? Can we see that? How do we get to the fact.

Yeah, that's way above my pay grade, I'll tell you that. That is very challenging because you have to remember they're competitors. They compete. And many of them are publicly traded companies, so they're very hesitant to share specific data in some cases. And I would encourage you, and I know and some of you have probably talked individually to different retailers, I'd encourage you to reach out, and I'd be happy to help you do that. But that's very difficult.

And I think that's truly part of the problem, is how do we get that good set of data? And I'll be honest, I've been asking since I started this job, data. I agree with you. We need better data. And I've been trying to figure out ways that we can make that happen. But it is a challenging piece to this.

That's why I think it is difficult when part of the challenge is we do call law enforcement, and if law enforcement could file police reports more often, but when it's happening so many times across the state and cheerpoint, I think we talk about the counties. There are some counties that don't have the ability, they don't have the budgetary wherewithal to be able to invest in that. That's why you're right.

The $267,000,000 grant proposal that I advocated for to the Governor was because I went out and talked to local law enforcement that was money specific to retail theft. But unfortunately, I don't think the state has a lot of money to be able to push a lot of funding to this. So I agree with you, and I think that we're more than happy to work with the Legislature on how can we figure out ways to do better at data collection.

But it is going to be a challenge because of the level of competition among retailers. Smaller retailers don't have the ability to necessarily do it. And I really want to make sure we focus on them because a lot of focus can get put on kind of the national brands. But these poor retailers are suffering in our communities every day, and I don't think they necessarily get the attention they deserve. We have to make it easy for them and recognize their challenges.

But I don't disagree with you on the data, and I'm always trying to find ways that we can do better on that area.

Thank you. And just one more question, and I appreciate you bringing it back a lot to smaller retailers because those are the folks that I talk to in my community who are struggling with this. Right. And a little bit makes a big difference in their businesses. I think that one of the things that we really need to figure out is how do we make sure that we're getting more support and resources for those smaller retailers who don't have whole departments dedicated to loss prevention.

But I wonder if there's a way to get to the data in an aggregate way that doesn't call out specific companies that we could really dial down on more specifics, because we're hearing Mr. Krushik talk about California as the worst place to be. It sounds like from your know, but then we're talking about shoplifting being down overall in California. So it's very hard to really get a handle on what's really happening when we're hearing these really different perspectives and different statistics sometimes.

And so I wondered if you could talk a little bit about, because I appreciate what Ms. Parrish Bauer brought up about the issues around staffing self checkout. If anyone's gone to the Burbank airport lately, the store there just put a whole wall of self checkouts in the little store, and you can't even get to a person to check out, which is what I always do.

But do you have data or information about differences in stores that do use self checkout or do have lower staffing numbers versus stores that don't? It sounds like anecdotally there's some significant differences with, like, best Buy and Lowe's, but I wonder if you're seeing some significant differences there.

I don't, but I'd be happy to research that more. I do know you're seeing more and more retailers moving away from self checkout. But again, we go back to the problem of you have to have people there who are willing to take the jobs. And I think the point taken is that people are rethinking. Retail used to be the best, I'm going to go in 15 years old, work in retail. Right.

And now people are rethinking that we're an industry that can give you your first job and your last job. A lot of our retailers hire people in retirement because they need that social interaction. So I think we're seeing some of those changes, but I do think it's a collective problem we're seeing in California outside of just retail, we have Doctor shortages, nurses shortages. We've got a lot of other industries that are facing employee shortages. I think we're part of that as well.

And so that's why for us, how can we also bring in job training programs? How can we get people, and how do we change the narrative so people come back to realizing retail is a great place to work, that we have to figure out some of those solutions. But I will do some digging for you and circle back with you maybe after the first of the year. Let me do some research with some of our Members, particularly on that self checkout piece.

Appreciate that. Thank you.

Ok. Assembly Member Petrie Norris.

Thanks. Mr. Chair, a couple of additional questions around data. So, yes, Mr. Krushuk, I think you said that California's loss numbers are the worst in the nation.

I didn't say the worst in the nation. I just said they're very high and that California has become one of the most difficult places for retailers to operate. I didn't say California is a terrible place.

No, but I think you did share some examples. I think that in order for us to actually craft the right policy, it's so, so important for us to understand where is this a California problem and where is this a nationwide problem? So again, to the point of data, if you have data that can show loss rates for every state in the country, that's really, really important information for us.

And I think that's actually a really important just fact for all of us to have as we kind of develop and then interrogate hypotheses. So I don't know if you've got that information or if that's something you can share.

Of course I don't. Okay.

The retailers don't share. As my colleagues stated, the retailers are reluctant to give you any information. So unfortunately, my data is more boots on the ground, 3ft, not 35,000ft in the air. My data is stores closing, retailers not being able to hire, retailers locking up their merchandise, consumers facing more friction in shopping and having alternatives to go to, consumers who tell us they don't feel safe going out. These are not data points in percentages and decimals. These are data points in how your constituents behave.

That's the data that we track. We watch how people come to our shopping centers, what they do, what they tell us when they're there, what the retailers tell us about store traffic, whether they lock their detergent up, that's the data we track.

And I see all of those things happening in California. My constituents see all of those things happening in our community. That's why they're fed up with it. Right. So that's why we're here. But are those trends unique to what we're to the California experience for retailers, because I've heard from some national retailers that this is something that they are seeing nationwide, from others that it's not. So I think understanding are those trends and perhaps it's some of those more qualitative measures.

Really and truly, are we the only state where this is happening?

California is not the only state where this is happening. I think it's been widely publicized what's happening in places like New York and Chicago. Texas is very different. I can tell you that in the western region, we also have property in Arizona. We don't see these similar types of things to the extent that we see them in California. So it's not unique to California. California is not the only state in the country that's having this problem, but it is uniquely pronounced in certain parts of California.

Okay. And I agree, but I think the more we could have data, I wish.

I could give you the data. In preparing to come here today, I talked to 15 retailers and said, I need data. I need numbers. And they said, zero, well, we can't give you numbers. And notice, I didn't use, other than the public article about target, I didn't use any retailers names. They don't want that in the public for whatever reason. And I realize that makes your job harder to help them if they won't help themselves. I'm acutely aware of that.

But the reality of it is you're starting to see it now show up in store closures, and that's going to be a big problem for these communities.

Yeah, 100% agree. I mean, the Halloween out of our retail and commercial corridors is not just terrible for.

Yeah, go walk down case street.

Terrible for our entire community. Right. Agreed. Okay, quick question. Another follow up on data and kind of picking up to the point that Assembly Member Ortega raised. I think if this Committee can get some data on the growth of online marketplaces over the last five years, I think that's also another really important piece. Thank you.

In my opening comments, one of the things we're going to be looking at is online retailers and one of the follow on hearings. So that's definitely something we're going to do, something Burfung. Thank you, Mr. Chair.

I'd be remiss not to ask retailers. I know we've been focusing a lot on what happens in the store, but retail crime exists in the store and on cargo theft and on porch pirates. And as we push people, if they don't feel safe going to the store, they're buying things online, as mentioned earlier. And of course, it gets delivered to their porch and then it gets stolen. Or they disrupt the supply chain and they steal things on trains, off trucks.

So if I could ask the retailers, could you just piece it all together? When we talk about retail theft, we're not talking just about the store, we're talking about the porch as well as the cargo.

Correct. And I think you have to divide it up a little bit. I would say the porch piracy is more, I would put in the bucket of more shoplifting. When you get into the cargo theft, that's when you move into the organized retail crime statute, which is why we're going to be pushing very hard and hopefully working with all of you on 490.4 and making some of those changes.

Cargo theft is not addressed in the organized retail crime statute and I think it should be, but that's also having an impact. And it's crazy when you, I remember a couple years ago, you might recall the Governor went down to LA with the trains and all of that. And I remember calling people and they laughed at me. What do you mean, Rachel? People are jumping on the trains and stealing. I'm like, yeah, that is what is going on.

And what's unfortunate though, is the people that are stealing are the vulnerable populations that the organized crime rings are using and revictimizing. And so that goes back to the point of how do we utilize retail theft as an intervention point to get these individuals who need help into programs? Because you can't force people into programs, you can't force people into a mental health program, you can't force people into drug treatment program.

But you can do that if we have an intervention point where individuals have to make a choice, you go into serve time in jail or you're going to go into a diversion program.

And so I think that it all fits together and I think we have to look at it cohesively because it's all having an impact and it's impacting people coming in to work for the industry, our transportation, our goods movement, our warehousing units, and then ultimately to the stores and to now to a consumer doorstep.

I appreciate that. And I think that's what's important is the solutions you outlined about targeting repeat offenders and aggregation. It's important in the retail space, in the cargo theft space, and when it comes to Portuguese pirates. Thank you very much. I just have one sort of question and comments. So obviously I've been talking to a lot of the retailers, small businesses, some of the local enforcement folks, and it feels like a lot of folks are pointing fingers at each other.

The retailers folks are complaining that the retailers aren't reporting enough, that they basically don't do anything, that when someone comes into the store, they're just letting some of the enforcement folks say they're just letting them walk out, not understanding that they're trying to make sure that their employees are safe and they're not asking their employees to intervene.

Then when I ask folks from the enforcement folks whether they're prosecuting at the misdemeanor level, they basically say that they don't end up having anything to prosecute, that there's not a thing that's being brought to them. And then we've got other folks who I've heard these stories, at least in one jurisdiction, where retailers who are reporting things that are not being, when they've called, are actually being criticized for overreporting and actually being accused of being a nuisance, which I was really surprised by.

I guess that is actually the genesis of my last question, which is, are you finding those kinds of issues more than in the jurisdiction that we've heard the stories about? Is that something where people are being. Where retailers are actually being discouraged from reporting in more than this one jurisdiction?

Yes. And the other part is that we'll have, I have another Member company in the Bay Area who had a retail and their employee waited and waited, and law enforcement didn't show with. We have a group of retailers we're trying to work with in a certain city where. Yeah, that's part of the problem. And I think part of it is this problem has gotten so big that it's almost, okay, how do we solve it?

And that's why I think we have to look at different pieces and take it step by step. What is the most pressing thing that we can do now? How do we stop the repeat offenders? How do we provide the consequences? I tell my Members, this is a marathon, not a sprint. Right. We're not going to solve everything overnight, but we have to start making, we need a disruptor to at least start disrupting the behavior. And I think we all have to have accountability.

Retailers, we have to take accountability. Law enforcement, Das, City Council Members, county supervisors, legislators, the Governor, we all have to work collaboratively to find solutions, because you're absolutely right. I feel like we're on this Merrygo round and we keep pointing fingers, but I'm willing and able to work with anyone who wants to work with us, including people we don't always work with all the time to find solutions because it's too important. And again, I go back to.

We were able to remove our opposition to SB 553 because we want safe work environments for our employees and we want a safe shopping center experience for our customers. But we have to work collaboratively. And while I understand that everyone's very focused on data, the reality is that's not the perception of what's happening in California. I bet you every one of you can tell a retail theft story.

I get on a Zoom call to talk about environmental sustainability, and it starts with, let me tell you about someone I just saw stealing in the know. I have to tack on time because everyone is seeing it. And I think we're looking to you for your help and partnership on finding solutions.

I'm not someone who believes that shoplifting has gone down. I mean, just from talking to retailers, knowing what I experience, the fact when you walk into a store and more and more of the stores is locked up, I think that's data that we need to be paying attention to. On the other hand, I also am circumspect of calls for pulling back on Prop 47 and looking at the $950 because I do think it's more about making sure that there's a consequence.

When we talk about traffic enforcement of traffic laws, we don't put everyone in prison for minor infractions of traffic laws, but we have a system in place that results in a relatively high chance of us having a consequence and something happening. So I'm hopeful that in future hearings, we can think about some of the diversion programs, some of the things that I think you suggested in suggesting a traffic school, but then understanding what happens if someone doesn't go to the traffic school. Right?

So I think we need to think these things through, but I do think that we should be thinking about smart solutions to these things and some out of the box thinking that we haven't thought about before. So with that, I don't see anyone else. Do you want to make one last comment?

If I could just make some comments for some clarity. So, like the traffic issue that we're talking about, prior law enforcement, I think we all know that with me, when you get pulled over by traffic officer, that's a misdemeanor that they are observing, they are seeing firsthand. So that's why they're able to give that ticket. Whereas we're trying to compare it to the petty theft that's happening or the grand theft. Not the grand theft, but the petty theft.

It's not in the presence, as brought up earlier in our first panel. So that's the other thing that we also need to think about. I know one of my colleagues here who's not here right now, but was talking about why shoplifting is down, and that's because it's not really a crime anymore that's being reported. It's being underreported, as was brought up. So those are other things that we need to look at when we're trying to discuss the data.

That there's reasons that the data is so Low is because it's not being reported. It's not something we're capturing. And also, another thing that's going on, that Little Hoover Commission, if you guys, most of us know here also, obviously, there's a study going on there. So I'm hoping with that we are going to have some of that data that we want, because obviously, data is a big thing.

And that's something I learned in my first year coming up here, that, hey, we need to get the data. So I'm thankful that they're doing that as well. That's all I need to say. Thank you, chair.

Thank you, Mr. Alanis. Okay. With that, I want to thank the Members of the panel for spending so much time today. Really appreciate your focus on this and helping us today. So thank you. We can bring the next panel up.

Thank you. Welcome. It's a long afternoon. Last but not least, I'd like to welcome our third panel, which will feature perspectives from law enforcement and criminal justice reform advocates, including the organizational sponsor of Prop 47. We're grateful today to be joined by Lenore Anderson from Californians for Safety and Justice, Ivy B. Fitzpatrick from the county District Attorney's office and on behalf of the California District Attorney's Association, Christine Soto De Berry from the prosecutors alliance of California and Chief Alexander Gamalgard from the California Police Chiefs Association. Welcome.

You each have six minutes today. Ms. Anderson, please proceed when you're ready.

Thank you for the opportunity to testify this afternoon. I'll speak first on the impact of over incarceration in California prior to Proposition 47, and then I'll talk about the purpose and scope of the measure. Next, I'll discuss the challenges and mechanisms for addressing retail theft. And finally, I'll outline some proposed solutions to stop chronic crime cycles. First, it's important to ground ourselves in the history the history of mass incarceration in California grew dysfunctional bureaucracies that had few incentives to effectively stop crime cycles.

California voters overwhelmingly enacted Prop 47 in 2014 in response to years of extreme overcrowding in state prisons and gaps in crime prevention. For decades, California led the nation with staggering incarceration rates and prison spending. The state also passed extreme sentencing laws and grew the size and role of criminal justice bureaucracies. As the size and role of criminal justice bureaucracies grew, arrests incarceration became the one size fits all response to all kinds of social ills, from homelessness to mental illness, drugs, and more.

Despite the justice system being ill equipped to address these problems, bureaucracies quickly became overwhelmed with the sheer volume of incoming it was in this context that bureaucratic priorities were established. Most of those priorities revolved around increasing arrests and prosecutions for what was easiest to process, cases quickly, and incarceration in state prisons to move problems out of state's hands. There was little oversight. There was little data driven decision making, interagency coordination, or community engagement.

This approach led to a crisis, extreme racial disparities and state prison overcrowding, one person dying per week as a result of medical neglect, and people languishing in prison for far longer than necessary for public safety. On top of that, recidivism rates were abysmal, with three out of four people returning after release. The purpose of Proposition 47 was to reduce the use of state imprisonment for low level offenses and reallocate state prison spending towards local safety programs.

The measure has been successful in achieving that the details, as was already discussed today, include it reclassified six low level offenses, from felonies to misdemeanors. Nothing was decriminalized or legalized. Criminal laws in California can be either infractions, misdemeanors which are punishable with county jail or felonies, which are the most serious. The measure also requires the state to annually calculate prison cost savings generated.

65% of the money allocated through this measure goes to the Board of State and Community Corrections, who provides grants for programs ranging from mental health diversion to substance use disorder treatment, behavioral health treatment, re entry, and more. The measure has helped reduced state imprisonment such that the prison crisis in California has been abated and the state is no longer facing federal prison crowding, mandate violations, or chronically endangering staff and residents in the prisons.

What's more, over seven hundred and fifty million dollars has been reallocated to local safety programs under Proposition 47. The Board of State and Community Corrections evaluates the effectiveness of these programs and has found lower recidivism rates, higher employment rates, lower rates of homelessness, among other positive public safety impacts. That's the essence of what Proposition 47 was about. Addressing sophisticated retail theft is urgent and important, to be sure, and it requires the full use of existing state laws.

For most of the time that Prop 47 and other justice reform measures have been right sizing the use of prisons, crime rates remained at historic lows after the pandemic. We've seen some shifts. Retailers deserve safety, to be sure, as do all Californians. That's not up for debate.

What also shouldn't be up for debate is whether or not we use the full authority of existing law to address any shifts that have come about the retail theft issues that people are presently most concerned about, from smash and grab mobs to organize retail crime are felony conduct. These crimes are not the purview of Proposition 47, and the measure does not stand in the way of the justice system's ability to address them.

What does stand in the way of the justice system's ability to effectively address them are the bureaucratic priorities and practices that were established long ago under the era of mass incarceration. Here's just a few of those practices. There's no timely sharing of crucial data. Justice agencies do not prioritize sharing information with one another that would facilitate a quicker response and a resolution to retail theft crimes. Failures to appear and case dispositions are not quickly entered into law enforcement data systems.

Bench warrants are backlogged without any action taking place. If law enforcement doesn't know the person in front of them has numerous priors to failures to appear or court ordered arrest or warrants are being ignored. That's a shocking system breakdown. There's been a little ability for a long time for California's justice system to solve most crime. Most people don't realize that property crime, especially, has not been prosecuted or investigated effectively for generations. Less than half of all reported crime is investigated and prosecuted effectively.

That's true for violent as well as property crime. For example, theft cases. The clearance rates, which means the rate at which it was resolved, had a record low of just 7% last year. With decades long trends in the less than 12% resolution rate.

Need to wrap up in 30 seconds.

Okay. And to the extent we're talking about misdemeanor conduct, misdemeanors are chronically deprioritized at the local level. Law enforcement doesn't take action when they can, and courts do not swiftly calendar cases when they can. I want to just take the last couple of seconds to talk about solutions. There are many things that can and must be done immediately. First, further regulation of online marketplace to prevent the resale of stolen goods. We need to improve crime investigations and make misdemeanors meaningful.

Civilian investigators can help address the low clearance rate, which has been in place for decades. We can build community trust as well. We also need to address the backlog in warrants and failures to appear. Improve misdemeanor courtroom practices, including accelerated misdemeanor courtroom dockets, and invest importantly in the programs that are working. Diversion programs, substance use disorder treatment, and mental health programs should not be only through grant programs. They should be the mainstream, main way that the justice system operates, especially at the misdemeanor level. Thank you.

Thank you very much. Fitzpatrick, next. Yes, thank you. Good afternoon.

It's my honor to testify before this Committee today. I've been a prosecutor for 25 years. In the last 15 years, have been with the Riverside County DA's office. In that time, I've supervised nearly every unit within our DA's office, homicide, sexual assault, child abuse, but also misdemeanors and General felonies, which is what we're talking about today.

Over those 25 years that I've been doing this job, we've had a lot of changes for sure in the criminal justice system, but one of the most positive changes has been an increased focus on incentivizing treatment and on collaborative courts. We take a collaborative approach to justice in those courts, and they can be very successful. Currently, I oversee those efforts as the supervisor of our mental health and collaborative courts units in Riverside County.

We work with our justice partners in those programs on treatment focused alternatives to sentencing. That includes mental health court, veterans court, drug court, and our most recent one is a homeless court. I've seen amazing success with these programs, and I want to tell you about one success in particular, because I think it kind of epitomizes what we're talking about here and the power of the criminal justice system when supplied with the right tools to incentivize treatment and make profound life changing outcomes for the defendants.

So I'm going to talk about Jennifer. I met Jennifer when she was a defendant in drug court over a decade ago. She was addicted to meth and had run up a long rap sheet of drug crimes, as well as the associated theft crimes that paid for her drug addiction. Jennifer had been through diversion, misdemeanor, and felony probation, and had lost her children to CPS. But none of that incentivized her to treatment.

Eventually, she racked up so many thefts that she was facing a prison sentence because back then, prosecutors had the discretion to charge repeat offenders with a prison eligible felony. Now that she was facing a five year suspended prison sentence, Jennifer was incentivized to enter our drug court program and to work that program long enough for it to take hold.

Seeing the positive changes then that came after that time, she wanted to continue the program until eventually she graduated from drug court program and like all people who complete the drug court program, had her felonies reduced to misdemeanors and expunged from her record. 12 years later, Jennifer has her master's degree in addiction counseling. She's a licensed clinician, she's a homeowner, a mother of her four children, and she's a case manager in the drug court program in Washington state, where she lives.

Jennifer and I have kept in touch through the years, and she has told me many times that it was the prison eligibility for her repeat offenses that finally incentivized her into treatment. And what is more, she believes that if the laws were as they are now, she highly doubts she would be sober and living the beautiful life she does today and contributing to society in the way she does through the drug court program. But Jennifer's history is honestly, her criminal history is not uncommon.

Okay, drug addicts still fund their addiction with theft crimes today, but what's different today, and yes, prosecutors are still charging these crimes, is that there's virtually no real penalties for repeat offenders and no real incentives to enter treatment today, due to the changes brought by Prop 47 in 2014, theft under 950 is almost always a misdemeanor, no matter how many times you do it. There are exceptions, but it's almost always a misdemeanor.

Yes, we can aggregate offenses to over the 950 limit if we can show a common plan or scheme, but that is very difficult to do. And even if we aggregate and can charge a felony, most repeat offenders will serve little to no time of their county jail sentence because the jails are under consent decrees and so overcrowded due to AB 109.

AB 109 has not been mentioned today, but it is critical to this conversation to understand what is going on in our local courts, not just what is punishable, but what is actually punished. In 2011, AB 109 was enacted. It mandated that a vast majority of felonies be served in the county jail, aka local prison instead of state prison, resulting in a massive jail overcrowding problem.

And this goes to Assembly Member Schiavo's question in the panel, and some questions that were posed to Ms. O'Neill, also in the first panel. Even if we aggregate, in other words, like many well intentioned initiatives and changes in the law, and even if we aggregate it and we come to a felony, the combined effect of Prop 47 in AB 109 has had a myriad of unintended consequences, including the inability to actually effectuate the sentences that are labeled punishable in the penal code.

So with no real consequences to the repeat offenders, there's understandably been a rise in the number and scope of theft crimes in California. And we talked about that. You heard the stats, and I see defendants in my own courtroom with 5 or 10 or even 20 misdemeanor theft and drug cases pending at one time, with no ability of the court system to increase penalties or incentivizing them like Jennifer, into changing their behavior or getting treatment.

And even if you can charge them with a felony, the jails are so overcrowded they will not serve their time. The same problem applies to the recent laudable changes to organized retail theft. Because those sentences are also got about 30 more seconds in the county jails, there's a high likelihood of early release and no disincentives to reoffend. Finally, while Prop 47 had laudable goals to reduce the prison population and incentivize treatment, it has succeeded in the former while failing at the latter.

With no incentives to enter treatment, addicts spiral further into their addiction and often become chronically homeless. As reported recently, a 2020 paper from the New York based Center for Court Innovation found that participation in California drug courts is down 67% since Prop 47, and that is not surprising to those prosecutors who practice every day. At that same time, homelessness rose 42% in California, while it dropped 9% nationwide.

And so while our homeless courts provide a path to treatment for those individuals and it gives them housing, work, expungement of their convictions, it's exceptionally difficult to incentivize the homeless into the program given this current state of laws. I thank the Committee.

Thank you very much. Next, I think we have Ms. Soto DeBerry.

Good afternoon. It's a pleasure to be here with all of you today. If you're not familiar with our organization, the Prosecutors alliance is a statewide organization of prosecutors, victim advocates and community allies. We're over 4000 Members across more than 20 counties, and we work collectively in the counties and here in the Legislature to promote solutions to the community safety challenges that we see around the state. And this issue today is a very important one to us.

I come to the work at the Prosecutors alliance after over three decades in criminal justice issues. I have worked on this as both a public defender, as a policy expert in a local mayor's office, and now as a prosecutor and running a prosecutor's organization. In that time, I have tackled this issue from many different angles, many of which have been mentioned on both this panel and prior panels. And the things that I have seen be the most effective in this space.

And I was thrilled to hear assemblymember Ortega and others raise is focusing on upstream solutions to the problems that we're facing. We can certainly chase issue after issue, case after case, until we fall and collapse. There's no doubt we have done that for decades in this state and every state across this country. But if we want to look for solutions that are durable and end a particular type of criminal activity, we have to look at upstream solutions.

We've learned this from the drug trade and everything else. If we focus at the very bottom of the pyramid, the pyramid continues to stand. So while punishment needs to be part of the conversation, accountability should be on the table and part of what we talk about. I think there has been explicit examples of what those frameworks can look like.

We've circulated to all of you just some of the theft code sections that currently exist in law that can be applied, that prosecutors around this state are applying to this problem. You heard in earlier testimony that in places like Kern County, where you have very law and order approach to the issue, the crime rates are very high in this realm. So what we know is that punishment alone is not going to solve this problem.

We have to be looking more creatively at solutions that result in real change, chair Burr, you mentioned that the biggest deterrence is actually the fear of getting caught. This is true. The National Institute for Justice has studied this. They understand. We all understand sort of intuitively. If we step back and think about what would keep us from crossing a line, it's the belief that you'll be caught that is the thing that most deters the criminal activity.

The challenge with retail theft is that there are very few people being caught for this activity, and therefore very few people making their way to prosecutors offices to have the consequences that some are contemplating changing in this realm. So one place we need to look is really at how are we going to respond on the ground, in the stores in those moments to ensure that there is an actual apprehension of an individual that can face a prosecution.

But I think I would urge us to look bigger picture prevention. There are efforts retailers can take to harden the target. They can have loss prevention officers. They can have actual store staff in their facilities. Those things do deter some of this activity. None of these things in and of themselves are a solution. But as was said earlier, all of us working together, collaboratively, leaning in where we have authority and opportunity, makes a difference.

Additionally, I would encourage us to think about ways to push law enforcement to do higher impact investigations. We've seen some of that with the state funding that has come around. When I was in the San Francisco DA's office, we ran numerous high level investigations, and we found theft rings that spread from Hawaii to Texas, up and down the State of California. It took us dedicated investigation led by our office, where we brought in the CHP.

This is where the model emerged of having the CHP run these efforts, and we have real results from that. We saw drops in that crime in our jurisdiction as a result of that investigation and those arrests. The Legislature, you all have an opportunity to act, and I think it's why you're gathering here now and asking us to come before you. You have already passed some great tools.

Many of the code sections that you see on the sheet we circulated are a result of action taken by this body in previous years, 2021. We now have multiple new code sections on the books that enable us to have more accountability in the courtrooms. Additionally, you can help us with the data question you all asked.

We had a Bill passed 20418 that is just waiting on funding that will allow us to collect better data from DA's offices around the state so that we can answer some of the questions you have for us about how the cases are being handled, what kinds of charges are people facing. What are the consequences for the charges that they're facing? We also had a Bill that didn't pass AB 327, which would have required law enforcement agencies, arresting agencies, to share their data.

These are critical, foundational pieces of infrastructure. We need to answer these questions responsibly. We'd be happy to partner with any of onlos, but as we talk high level about shrinking the opportunity, what we need to do here really is shrink the opportunity to run into a store, grab hundreds of dollars of merchandise and run out. We can use a law enforcement approach, but our most valuable tool will be shutting down the secondary markets for these goods. I've done this before in San Francisco.

We had an issue around this country with cell phone robberies. We were being inundated with cell phone robberies, as was every major city around this country. And we were prosecuting those, mostly robberies, repeatedly as they came to us. But what we asked ourselves was, is there something else we can do?

30 seconds.

Thank you. Can we make the cell phone essentially a paperweight that has no value once you take it? And indeed we did that. We installed a kill switch. That crime dropped by 50% just on the passage of that Bill. 50% far more effective than anything we could have legislated with an increased punishment. We were doing the same. Now. And you all are passing these bills around. Catalytic converters. We're putting ID numbers on them. We're creating traceable evidence so that those crimes can't continue.

Right now, when you steal 300 bottles of dove shampoo or guest jeans or whatever the item is, it goes not into that individual's personal wardrobe, it goes online. It goes to swap meets. We need investigations of those things and we need stricter regulation of those markets. If I can get verified for a blue check for what kind of posts I put up, why cannot Amazon, Ebay and everybody else have to verify that those are legitimately acquired goods that they're selling on their platform?

We can mandate it to do that. That will shift this whole conversation. We will actually see the relief that retailers, consumers, community Members are looking for, and you all can be the promulgators of that.

Thank you very much. Mr. Gammelgard.

Yes. Good afternoon, Mr. Chair and Members. My name is Alex Gamelgard. I am the President for the California Police Chiefs Association. And thank you very much for inviting our Association to the table on this very important discussion. I want to start by simply stating, the primary goal of law enforcement is to protect the public from harm.

And in a broader context, we are part of the criminal justice system whose function is to correct harmful and criminal behavior, whether that is through rehabilitation, education, incarceration, or a combination of any of those. Understanding these goals, when we look at retail theft, and might I add, theft in General, we collectively are failing, our communities are being victimized, and the public feels vulnerable, indicated by multiple recent polls that show over 80% of respondents believe theft is a major problem.

From a law enforcement perspective, when we see the same individual being arrested time and time and time again showing no change in behavior, we must believe that our system is broken. Undeniably, Proposition 47 made significant changes to how law enforcement and our criminal justice system responds to theft. Notably, Prop 47 reduced penalties for repeat offenders, making it so no matter how many petty thefts or shoplifting offenses are committed, the penalty is always a misdemeanor.

And while misdemeanor offenses still carry penalties, the reality is our criminal justice system treats them as a less serious crime. In fact, it's treated similar to other nuisance violations such as vandalism or disorderly conduct. For these low level crimes, people don't expect a priority response or for the perpetrators to face arrest, prosecution, or sometimes incarceration. In practice, these crimes are where an officer will simply cite the offender with a notice to appear in court.

This is an appropriate response for many misdemeanors, as the process to arrest, book, detain and prosecute takes tremendous time, resources and other valuable resources from your community guardians. Expecting the entire system built as it is to change how it has been for so long at this point is impractical. In addition to Prop 47, we have also seen a significant increase in good conduct credits awarded against individual sentences. In most cases, misdemeanor offenders will only end up serving half of their total sentence, if even that amount.

In addition, the Legislature has eliminated various sentencing enhancements on repeat offenders, removed other penalties, and limited probation terms, all of these adding significantly to less accountability. Finally, jail populations, as was mentioned earlier, in certain counties, means that those serving misdemeanor sentences are at the top of the list for early release. All of this practically means that there's very little consequences for theft offenders in California.

Hundreds of chiefs across the state can tell the same story, an offender scoffing at their officers, citing, quote, just give me a ticket and let me go. Or in some cases even asserting, you can't arrest me for this. And although these statements are not accurate, they are pervasive and indicative of the dangerous social consequences that we are seeing. When the public believes there are no consequences, criminal behavior escalates, which is why we are now seeing brazen smash and grabs and carjackings in broad daylight.

To correct this, there has to be attempts to create statues around organized retail theft, but those laws have been narrowly drafted. Our organized retail theft laws require a couple of things, two individuals acting in concert not simply to steal, but to steal with the intent to sell, which is an incredibly high burden to prove in court and practically makes the statute ineffective.

And although DAs can aggregate theft cases, their ability to do so is very limited to circumstances happening in rapid succession under what our laws outline as what's called in the penal code, one intention, one impulse, and one plan. Ultimately, these existing statutes cannot solve for the thousands of thefts occurring by individuals acting alone over a span of weeks or months, which is the bulk of these incidences.

Speaking of the number of thefts committed, collecting statistics related to retail theft is no simple task, as we've already heard today. First, not every theft is witnessed, and even when it is, not, every theft is reported. This means our data does not capture the reality of the problem. The problem itself has now disincentivized reporting, which now has created a self fulfilling prophecy of sorts. Second, we do not collect uniform data on multiple offenses committed by the same individual, often committing crimes across jurisdictional boundaries.

Lastly, and to be fair, it is a small group of offenders responsible for most crime. So we cannot correlate macro arrest statistics alone to the true impact of the problem in our local communities. But what we do have is one good data set collected by the California DOJ and reported annually. That data, looking at the numbers, we see that the value of stolen goods has only increased since the passage of Prop 47 in 2014.

Comparing this data from 2014 to the most recent complete year in 2022, the annual value of stolen goods reported to DOJ has doubled from just over $2 million in 2014 to almost 4.2 million in 2022. Standardizing to 2 million for inflation, it only grows to 2.76 million, still almost a double in that amount of time. Anytime crime statistics double in such a short period of time, we should take note. So the question is, how do we fix all this?

Again, trying to get the entire criminal justice system to respond differently to a misdemeanor crime is impractical and would require significant changes at every level, which would likely have unintended consequences at 30 seconds, and is obviously something that we should continue to work towards. Instead, California police chiefs has sponsored legislation in the past with the League of Cities Retailers and Das to reestablish higher penalties on repeat theft offenders. While there are other changes that can be made.

It is our belief that focusing on the repeat offenders is by far the single most impactful change needed at this point. Thank you all for inviting us to this hearing. We look forward to taking questions and engaging in the conversation.

Thank you very much. Okay, we're running a little bit behind, so we've got about 15-20 minutes for questions. So I'm just going to ask folks to be concise and ask sort of two minute questions. Anyone who has any questions, could you put your mic up? I see Assembly Member Mccarty and then Petrie Norris.

Thank you. Before my questions, I want to note that I fully support this effort to have the accountability for the social media platforms. I'm not sure the name of it, but kind of an online fences in the pandemic. We all started buying things from offer up and Facebook marketplace. And so I think that is a fabulous endeavor for us to dig into. But I will say that can't be the only solution to this as well. So I'm glad you're here together.

So I kind of have some back and forth here and I want to. Not really through me, not at each other over there. But let me focus first on the DAs. So the question that we heard earlier and that we just heard from the advocates is that punishment alone is not consequential. It's fear of getting caught, fear of some type of accountability. So we hear the questions, ironically, that we need to police more, we need to have more arrests, more action.

So walk us through in just practical, simplistic terms. I'm sorry, simplistic terms. Why the current law with misdemeanor arrests when it comes with up to six months in county jail, why that can't be enough if that's the truth. It's fear of getting caught in accountability. Whether it's a year and a half in Folsom or six months in county jail, you're still locked up. So why is that tool inefficient to tackle the problem?

Okay, so the penal code lays out what the crimes are punishable as, six months, 16 months, two years, three years, and they lay out the actual punishment that could be given to the defendant. Then there's the reality of what is actually happening. And the chief alluded to this as well. And I live in one of those counties in Riverside County. So to give you some perspective, after AB 109, and that's why I mentioned it, the realignment act, it has a part in this conversation.

And what happened there is that in 2011, a lot of felonies probably the majority were transferred. The sentences were transferred to be served in the county jail rather than state prison because of Plata.

Right. And what was going on in the federal case. But what happened was when you transfer all of those people to the county jails, the county jails are busting at the seams. They don't have the room to house Low level felony defendants who are sentenced, much less misdemeanors. The misdemeanors who actually might serve some time typically are those domestic violence and duis. Everybody else is released. So that's sort of the answer to your question is that, and I want to back if I can have.

Sometimes people, okay, it's the fear of getting caught. It's showing up to court that first time. They don't want to ever do that again. That's most people in this room, but that's not who we're talking about. And we're talking about people who are not having a consequence for the behavior other than that. And so they continue the behavior and they don't serve any sentences in the county jail. I hope that answers your question.

Yes, but not really. So I'm still having a loss. I know there's 58 counties. Some are more crowd than others. So are you saying that under the tool that you wish you'd have, you'd get a repeat offender and have some accountability and that person would go, you don't care whether they go to state prison or county jail as long as there's some incarceration?

Assuming that the diversion and collaborative courts path doesn't work, because we all agree that's a better path, but assuming that fails some type of accountability, you all don't care whether it's a county jail or state prison, correct.

If they were serving the actual sentence in the county jail, I would not have a problem with that. But that's not what's happening.

So do you have examples of where you prosecute repeat offender for retail theft for misdemeanor? And there's a sentence and the sheriff just says, we don't have any. You can't stay here even though you have a six month sentence. We're going to release you after 10 days. So that's happening over and over. And that's why DAs are just throwing up their hands and saying, I'm not going to do it.

Oh, no, we're filing the cases. We're filing the cases and we're prosecuting the cases. I can give you an example. There was Christopher Jackson from our county. You had let me make sure I get it right. 54 burglary counts that he was being prosecuted for. And he did seven months in the jail because the jail is full. It's not like the jail from 15 years ago when I came at the DA's office.

That jail is filled with mostly violent offenders, murderers, rapists, child molesters who are awaiting trial. They're pretrial in the jail. So the sheriffs are in these horrible, difficult situations of deciding, because they're under consent degrees, who do I keep? Who do I keep in here? And they're going to keep the murderers, the rapists and the child molesters who are waiting trial. And if they have to, they're going to cut loose theft, sentenced theft defendants. And it's a terrible situation to be in. No one wants that.

If they were serving their entire sentences, we'd probably have more Jennifer's who are going into treatment. It really hurts me to see that statistic of 67% down in drug court. I want those people into treatment. And the only way to get it is some enhanced penalties.

Yeah. So the enhanced penalty and the potential sentencing, in your eyes, doesn't matter if it's county jail or state prison, as long as there's a legit amount of time that's not withered.

Right. And under AB 109, that's not happening. Right. Because there's no room at the jails to accommodate everybody that was in the state prison that we used to send at the state prison. So that's what's happening. People aren't serving the sentences.

Okay. We'll certainly come back in the future. Let me ask now to the advocates on the repeat offenders and this notion that collaborative courts and treatment and diversion, what's wrong with that? Assuming that the person has a place to go and is offered a legitimate option of having basically the tool that you choose, this door, or there's some accountability on the other end. What's the flaw in that?

So there's. First, I just want to articulate that. I think one of the key challenges is that this idea of no consequences means that if someone is cited in release and they don't show up to court, nothing happens. That's a much bigger number of people that we're talking about than the people who are in court and for which there is a sentence. If you're not having people sentenced. Well, first, if you're not investigating most of it. Right.

And again, 12% of crime, that is property crime is investigated, 12% of the total. That has been the case for decades, then you're talking about of that 12% for which there's action taken. If the person doesn't appear in court, then there's no sentence. So a critical step here is asking the question, what can be done to make sure that we're utilizing the misdemeanor court the way it is supposed to be utilized?

We're not getting people into court, and then when they're into court, we're not effectively sanctioning them or providing options or the range of options that are available as it relates to the question about how do you incentivize treatment? You can look at some of the programs that have been funded through Proposition 47 to see effective use of diversion. Right. You can have an incentive based diversion program, for example, if someone's facing significant amounts of fines, if we say, look, we can waive these fines.

If you go through this substance use disorder treatment, if you participate in this community service program, then you're seeing effective recidivism reduction strategies happen that don't require any jail, particularly, or you can have a smaller jail time also combined with those incentive based mechanisms for reducing the recidivism of that person. But what's key is, first, are we appropriately investigating all of it? Second, are we getting people in the door to the courtroom?

And then third, once they're in the courtroom, do we have the range of sanctions available that specifically address the drivers of that individual and reduce the likelihood that that person comes back? That's where you're seeing failures that are primarily around ongoing practices of criminal justice agencies, not the reflection of recent reforms.

I'd like to try to get to some other folks, if that's okay.

Actually picking up on a similar vein, and this panel has been incredibly instructive to me. I think oftentimes as legislators, we sort of pass laws and they go in the books. Turns out we actually have a lot of laws, and the question of how they're actually getting implemented and how that's showing up for the community is actually the more important question. So a number of you said that despite the laws that we have on the books, in practice, there are no consequences.

And I think, Ms. Anderson, you started to talk about what sounds like major issues with our misdemeanor court system and sounds like a major need for some pretty major reforms. So I guess as the Legislature, where would we start to make that happen? And again, Ms. Fitzpatrick, what you mentioned is it's not about us adding more penalties to this list. It's ensuring that the laws on the books are actually getting implemented and enforced and that individuals are actually serving time in county jail.

So I guess misdemeanor courts, the county jail system, what are the steps that we can take to address what, to me, sounds like major, major shortcomings and major drivers for the crisis that we're now facing?

I wonder if I could just start by saying, I think it is true. We could invest many more resources in speeding up misdemeanor dockets, in ensuring that sheriffs have the jail space to hold people. And we can and should ferret those out here in this Committee. And we do not have enough money to solve that problem that way.

We do not, we cannot Fund the courts at the level they would need to be funded to move a misdemeanor case through at a pace that would mean swift, certain consequences in a way that would impact a person and change their behavior. So I think it's a good investigation for us to ask what's in our misdemeanor courts and where can we move things? And a lot of us have spent time working on those questions.

When I was in San Francisco, we created a neighborhood court model where we pushed a lot of Low level cases into the community, and we trained adjudicators to handle those. They happened faster, victims were happier with the outcome, and there was less recidivism from it.

Those kinds of strategies are really effective in freeing up the resources of a judge and a prosecutor and a defense attorney to deal with what they actually need to deal with, which is a domestic violence misdemeanor, which is a driving under the influence misdemeanor. Those are the cases that need a courtroom and an adjudication, or at least some significant oversight. But things like Low level theft, Graffiti, public nuisances, those are things the community actually cares a lot more about than the courtroom staff.

Frankly, when we are all in those courts, we're like, these are the things that really tie up a whole courtroom in multiple courtrooms for days. So I think looking at those kinds of solutions can bring some relief around this. But in the same way, we can say shoplifting gets treated as a misdemeanor and it's only a six month maximum, and people are getting released. When we look, we have to separate out the kinds of behavior we're talking about here.

One of the challenges I'm having here is we're talking about shoplifting, and we're talking about smash and grab and organized retail. Those are very different activities that require very different responses from us. We titrated the penal code for a reason, because stealing food or something less than $50, less than $400 very different activity. In my opinion, a misdemeanor consequence is appropriate when you go into a store and you're smashing display cases and you're flipping over clothing racks and everybody's running scared.

That's felony conduct, and we have consequences for that. I don't know if you all saw the case in Los Angeles, the Sax Fifth Avenue in Beverly Hills. If you haven't, you've seen one like it. Masks and running in and grabbing everything, and chaos abounds. The DA's office has charged the individuals that were caught there with two counts of robbery. Those have five year maximums with two counts of conspiracy, two counts of grand theft.

They're facing, like, close to a decade or more in prison for that consequence. We do have tools to address the conduct that we see. I think if this legislative body and this caucus wants to think about how to shift jail resources, that's a much bigger endeavor.

I would encourage us to think about what are the ways we move the solution set upstream, because otherwise we will just break the bank again, trying to think about how to Fund the courts and the jails and the prisons to the level that responds instead of just cutting the legs out from underneath the problem to begin with.

And I think I would 100% agree. We've got to look at that entire spectrum and certainly agree with your point that if we remove the incentive to commit the crime in the first place, then we've solved 90% of the problem. Or maybe we can save this for a follow up hearing or a follow up conversation. Unless anyone has any words of wisdom on how to fix misdemeanor courts in less than 30 seconds.

Yeah, let's hold that for the end. I'd like. Ms. Bonta has a question. And I have a question, and we only have five minutes left in this portion.

Yeah, I want to thank you, chair. I certainly had a conversation with the speaker and had an opportunity to talk with you, chair, about the scope of this Committee or working group, whatever we are.

And one of the hesitations I had was that we would start to wax on into areas where we were focused on the existing solutions and kind of fitting those components of our criminal justice system into the challenge and the problem that we have around addressing organized retail theft and retail theft more broadly. My community is concerned about smash and grabs.

My community is concerned about business owners, restauranteurs, going out of business because they can't afford the insurance, plus recovering from COVID plus the experience of theft, closing down their shops. Those are the things that my community is concerned about. My community is also concerned about mass incarceration. We've just engaged in a conversation, quite frankly, that I think has been a little bit, some of the panels has been incredible disservice because we have not been basing the assertions that we've been making on facts.

To say that we are busting at the seams in our county jail system without any data unfounded is doing a disservice to this community, to this Legislature and to this body. We have to be clear on setting the baseline set of information that we can all operate from in order to be able to come up with solutions.

So I would just encourage us, as we're presenting information to people who are trying to desperately support their community and come up with solutions that we're doing so in a way that is based in fact and data and having our situation where we're essentially saying, sorry, we can't come up with the data, help me help you actually give us that data. And we're actually not doing that. And so I'm minimally frustrated.

I hope that we move forward in a way that actually centers data and centers the way in which we have and that we are solution oriented in the way that we are doing things. I don't want to enter, have this body enter into a full discussion around how to address the misdemeanor court system, although it needs to.

I don't want this body to enter into the fact that the length of time that people are serving, awaiting trial, not even charged, is so severe and so long that it's causing us to have people exist in our county jail system. I don't think that that's the work of this body. I want us to stay focused again on solutions, upstream solutions, if that helps. That actually causes us to be able to create some good.

So I'm hoping, looking forward to the next conversation and hearing that we will have on this. And I really encourage us to stay focused on using data and information that's grounded in the actual experience that is happening right now, to be able to address organized retail theft and retail theft in our communities in a way that is productive.

About the data I have provided to the Committee, I'm not sure if you've received it yet, but a one pager that shows the releases from the Riverside County jail over the course of the last.

Decade or more. And it shows a huge spike, as you'll see in AB 109.

Madam, speaking about county jails across the State of California is a very different thing than specifying specifically what is happening in Riverside County. That is not what you said. That is not what you offered.

I do have stats on the state. I had limited space on that. I am gathering those stats. As you can imagine, they're very difficult to gather for the whole state. But I'd be happy once I do to provide that to the Committee. But I do have at least my own county.

Thank you. I just had one. Is yours faster? Okay, go ahead. Why don't you go first?

On the point of data. And I heard, Mr. Gammelgard? Yes, good. Okay. I heard you talk about repeat offenders and I'm wondering, I've heard that a number of times. Is there data showing that this is a small handful of people and they're repeat offenders? What kind of data is there on this?

So as I mentioned, much of this cross, short answer: not great data. And not quickly in the hands of folks. It does show up on rap sheets, criminal history, documents, where it can show data. But oftentimes, too, what we're dealing with, especially in this particular topic of retail theft, is relatively short periods of time between alleged offenses. So we don't have conviction data because of that backlog within the court system. So we may show arrest, arrest, arrest, arrest, arrest, no conviction.

And just to be clear, do police agencies collect all of this? How do we get a sense of this data? How can we get more data here?

I think that through some of the statewide associations, we could work to try to gather some of it. But as you're probably aware, there's incredibly disparate data systems throughout our agencies, throughout California. Different vendors, different ways of collecting it.

The whole Cybers Nibers initiative, which was sort of mentioned on one of those bills that didn't pass, is definitely getting better because at the federal level, the way they're requiring data to be reported is becoming more consistent. So I think in the future we'll have better data. The data is there, but mining it is difficult. So if there was an attempt to create somebody or a group of people to help get that data, I think we could get it from the agencies.

Thank you.

We had AB 327, which would have done this very thing, require all of our California law enforcement agencies to report their data. We are the second worst in the country, right behind Florida.

Yeah. And there are incredible difficulties with the systems. I agree. We should be reporting it. Many people are trying, and DOJ is our reporting portal through to the feds. It's very difficult, but we are working. Many of us are committed to trying to make that work.

I'll just take the last question. And I've spoken to a lot of the store owners in my area, a lot of the retailers, a whole host of them. And one of the things that is pretty consistent that they tell me, it isn't an issue of sort of who is apprehended. It's the fact that at the misdemeanor level, there's almost no apprehension. So I asked them, what happens when you have a shoplifter come in? They said, well, generally, some of the times it's someone that's new.

A lot of the times it's someone that they know has come in repeatedly. They will make a judgment about whether or not they should be stopped, and they'll have security guards do that if they do. Many times because of safety reasons, they don't have the security guard stop them. If they do have a security guard stop them, they will generally confiscate the goods. I ask them whether they call the police or report.

They say they don't because the police won't come because it's a low-priority issue. I ask if they report. They say that they generally do. But then essentially they give them a trespass ticket, which basically tells them that they shouldn't come back. But they come back and they have repeated trespass tickets. So really, almost nothing happens at the misdemeanor level. And so I guess my closing question is, what kinds of things can we do? To me, this isn't a question of putting these people in prison.

It's a question of sort of, where do we find the resources and what are some of the things that we can do to create a change in the way people who think that there's no consequence will understand that there is some consequence.

I'm sure everyone has an opinion here, but I would say it is important for an arrest to happen. I recognize that retailers make an evaluation, and that is their prerogative to do so.

But when they call the police, the police need to come and take a report, and that needs to be turned over to a prosecuting attorney's office so that they can file a case. That case needs to be proceeded through the court so that there's a conviction. And then you have a prior ability situation. Right. But each point in that chain has to do its role.

And if we do, and you have a consequence, up to six months in jail or when you get into another category, up to a year in jail or up to three years served in a county jail, that's a very substantial sentence for a property crime. Three years of your life. I mean, you can almost graduate with a BA. There's no small amount of time your child will have gone from not walking to being in elementary school in that amount of time.

It is not a small number of years, but it requires each agency in that chain to do their role. Right. And that's what's happening now. I was shocked here to hear people now being threatened with being declared a nuisance for calling the police for help. That's new information to me is very troubling if that is happening. But we certainly hear around the state, around the state law enforcement agencies saying, there's nothing I can do. The law doesn't allow it. Prop. 47, your DA.

And that does not have a place in this response. Right. It requires each agency to do their role, do it well, and let the next agency step in and do their role and do it well. Otherwise, chaos abounds.

Just going to let Mr. Gammelgard just have one response to that, because obviously I know in Los Angeles the police don't generally come. So I know that there are different circumstances in different local areas, but I wonder if you can sort of respond about sort of who's making the decisions on the response criterion when someone shows up at a local area.

Yeah, I 100% agree with the fact that the police should be able to respond to any incident that the community is calling about. Unfortunately, sometimes that's not the reality. My jurisdiction, Northern California, is small.

We will respond, we will take a report even if the person is long gone and if it ends up being one of the balance of the seven to 12%. I do want to make a comment, though, that investigating crime versus solving crime, very different distinction on those numbers. I think that I can't speak for some of those other agencies. I also agree that, also surprised to hear that anyone would ever attempt to make a nuisance case out of somebody calling to report legitimate crime.

I don't think there's a place for that. But I mean, obviously what we're hearing today is this is a very complex issue that requires, I know in the hearings I've heard today, I think the judiciary and people who run jails probably would have some valuable insight into kind of how the whole system from start to finish, is working and where some of the bottlenecks are and where we might be able to make some improvements.

And if I could just add, I think you can incentivize interagency communication to focus on chronic issues. I think we've seen that. We've seen the state Legislature take opportunities to create incentives-based legislation where you combine money that would already be going from the state to the locals anyways, tie it to, "hey, are you guys communicating? Are you assessing and evaluating existing failures to appear for which no action has been taken? Are you assessing and evaluating how many times communication has been broken down?"

And then, "are you assessing and evaluating the kinds of sanctions that are dropping recidivism?" So you could do that through incentives focused on reducing recidivism and clearing backlogs, and that, I think, would be a huge advance to improving the kinds of courtroom practices that need to be improved under existing law.

Great. Thank you very much. Really appreciate all of you taking time with us today. Very grateful. Before we close, we're going to have some time for each Member of the Committee to have some closing remarks. But before that, we would like to open it up for public comment. We welcome Members of the public who wish to provide public comment in person in room 1100 to do so. In order to help me determine how long each participant will have to speak, could you please raise your hand if you would like to have public comment? How many? That looks like there's 12. Okay, so like to give each person 1 minute and let's go ahead and begin.

Okay, I'll speak quick. My name is Solomon Ets-Hokin. I've been a retail leasing broker since the early 90s. I work with people like Mr. Kreschick and people like Ms. Michelin's Members to put real estate deals together. I guess three points. One is, yeah, shoplifting to the Assembly Member from Modesto's point isn't going to be very helpful in identifying the issue. It's shrink is the number you need.

So if I could make a suggestion, maybe there's a way to have some legislation that may be in the business licensing process that you provide a regulation that requires businesses to report shrink and maybe dig into it and some other data that will help you stay on top of the issue, especially from city to city, neighborhood to neighborhood, region to region, because it does vary. Second point is, just understand that there's a misconception that brick and mortar is going away because of e-commerce, and it's not.

I don't have a lot of time to get into it, but retail this year was over 7 trillion.

We need you to wrap up.

E-commerce is a trillion. It's actually down from last year. So brick and mortar isn't going away. Then the last thing, the Assembly Member from Oakland who I'm a constituent of, I'm disappointed that she didn't ask any questions from the esteemed panel that you put together.

Okay, thank you very much.

Her mind is already made up, and to me, that's cynicism, and that's not very helpful.

Thank you.

Natasha Minsker, on behalf of Smart Justice California. Accountability requires intervention. It does not require incarceration. And in fact, incarceration has negative effects that make people more likely to reoffend and makes it more difficult for them to get their life back in order.

And the research is really clear on this that if you send someone to prison, the impact on their life is worse and they are more likely to reoffend compared to a county jail sentence. If you give someone probation, they have better outcomes than if you send them to county jail. And even better yet are programs like diversion. So what was not mentioned today? Law enforcement assisted diversion. Yes, there should be intervention.

People should be detained when they are breaking the law, but they actually don't need to be prosecuted at that level. They can be diverted. The important thing here is actually intervention and response, and incarceration should be reserved for violent offenses. That is what we want our court system and our jails and our prisons to focus on, and we're actually doing that well in California. The data shows that violent crime is down, so something is working and we need to reinforce that. Thank you.

Thank you very much. And we are going to be focusing on diversion in one of the following meetings.

Mr. Chair Members, Juliana Voris, on behalf of the League of California Cities, I'm very pleased with the hearing and appreciate the hearing. One of the top priorities for Cal Cities in 2024, which was just voted upon by our Members a couple of weeks ago, was to address crime.

It was actually the top vote getter amongst our Members, and that includes retail theft and shoplifting, but at the same time not going back to mass incarceration. So I wanted to align our comments with those of the Retailers Association as far as dealing with repeat offenders, but dealing that with diversion programs, getting them into the help that they might need, because a lot of those individuals do have mental health or substance use disorder.

I also want to say we appreciate very much the BSCC grants which were provided to 33 cities. While that didn't cover all the cities in the state, obviously, or even those in the urban areas, I have anecdotally heard from many jurisdictions, even though those just sent out in September, those have really helped the organized retail theft issue as far as getting advanced technology, license plate readers and whatnot. So we certainly would support any additional funding there. And I think that's it. Thank you so much.

Thank you very much.

Good afternoon. Chair and Members. Danielle Sanchez, on behalf of the Chief Probation officers of California. Appreciate the discussion today and the discussion around the safety issues in particular that our communities are facing every day. As this Committee and the Legislature continue to look at the complexities around this and the necessary solutions, we really encourage, obviously, as been discussed here, to look at this holistically. We really must recognize that it's time to reinsert both accountability and the opportunities for meaningful rehabilitation into law.

It's imperative that we also look at the underlying causes and the real needs of our communities on this issue. The connection between substance use and criminal behavior cannot be ignored, nor can the linkage between greater access to drug treatment with those accountability measures. Again, under the header of making sure we're having meaningful rehabilitation, probation departments supervise and connect with people on these important services, such as drug treatment, and provide the necessary interventions.

And we know that additional tools are necessary to achieve this balance of accountability and success required to avoid the outcomes that we've heard here today. So while some of the changes we know to the law may need voter approval, there are additional non-Prop. 47 policies that we can act on now that bring forward this necessary balance of interventions, opportunity and accountability. And so we look forward to those conversations with this Committee.

Thank you.

Mr. Chairman, Members Alex Torres with Brownstein here on behalf of two clients today representing a pretty significant cross section of California's business community. First and foremost, there were multiple points, data points and discussions around the unique impact of retail theft on the Bay Area. On behalf of the Bay Area Council, representing over 320 of the largest employers in the nine county Bay Area, I want to express our thanks to you, Mr. Chair, as well as Speaker Rivas, for pulling together this hearing.

We just launched a Public Safety Committee that is comprised of some of the Bay Area's business leaders. And so look forward. There's a lot of, I think, doors for potential conversation here addressing a lot of different pieces of this issue. So look forward to being a resource where we can. Also here today, on behalf of the new California Coalition, a civic advocacy organization focused on mobilizing the state's 700 plus local chambers of commerce, civic and industry groups, and ethnic chambers. So again, on behalf of new California Coalition CEO Tracy Hernandez, again want to extend our. Thank you. Look forward to the conversations to come. Thanks.

Thank you,

Mr. Chair and Members. Hello. I'm Meghan Huber, Economic Development Director for the City of Citrus Heights. You have a lot of great experts here to weigh in on potential root causes and potential solutions. I'm here to underscore that the more we don't try something new, the more we don't ideate and iterate, the more businesses will die in real time.

It is my job to attract and retain local business for the citrus Heights economy. Retail is our number two industry sector by both employment and revenue generation. And I can tell you that, yes, our national retailers luckily are resilient. But what really suffers from a business attraction perspective, we're not going to bring in any out of state business whatsoever.

California has a permanent black mark on its record right now because of how difficult it is to do business and how prevalent the retail theft story has become. And second, in terms of business retention, it's our small businesses that are going to suffer and atrophy. So really what we'll be left with is a business community that's homogeneous and made up of a couple of retailers at best, We lose our neighborhood vibrancy and our community identity. So thank you for giving attention to this and know that cities will work with everyone involved to move this needle.

Thank you very much.

Chairs, Member of council, Member of this Committee, Alex Turcotte, chief of police for the City of Citrus Heights. Here to represent not only my PD, but my community. It's been said here. But thank you so much for focusing on this very complicated issue. I agree with much of what the fellow panelists have said. This is not an easy fix.

This is not an easy solution. Incarceration on its own is not the only answer we have. Addiction, mental health, mandated treatment, diversion, those are all great options. I can't speak to the holistic data, but I can speak to locally in my community. Perception absolutely does matter. The traffic school conversation that was brought up for theft, we used to run that program when there was a consequence.

We could divert people just locally away from their first conviction with the consequence of theft hanging over their head and teach them about things like loss and shrinkage and consumer pricing and those type of issues with young people. And it worked out very well. Our city stands steadfast in being creative, innovative, and trying to find ways to hold people accountable. Our business owners are asking for it. Our residents are asking for it. We're here to partner.

I publish every single incident of data that I have in my Department daily on the line. We're here to partner with that. We were recipients of the BSCC grant for retail theft. We're looking to leverage technology. We want to be part of this conversation. We want to bring accountability, because both my residents, my business owners and suspects in the streets that we talk to feel that there is no consequence. I think there's plenty that we can do here. And thank you so much for your attention with this.

Thank you very much.

Good afternoon, chair and Members. My name is Duke Cooney on behalf of ACLU California Action, I really want to thank the Committee Members for their thoughtful discussion and, of course, our panelists for their insight on this incredibly and immensely multi-layered issue.

Our hope is that as these Committee hearings continue, that there is an emphasis on data-driven solutions that take into account some of the issues that Assemblywoman Bonta mentioned, the overlap of poverty, of housing insecurity, colloquially known as crimes of survival, and how those folks will sit at the cross section of any punitive measures going forward.

But we are encouraged by the conversations that happen today, especially the non-punitive approaches that seem to have had success in addressing retail theft and some of this lower level crime that we're seeing. So thank you so much.

Thank you very much.

Good afternoon. Glenn Bacchus for the Ella Baker Center for Human Rights. To be brief, we're a unionized nonprofit. We'd like to align our comments with those of UFCW saying that part of basic crime prevention is having staff having checkout lines. Those are strong. And we want to make sure that we're not asking a California taxpayer to backfill the responsibilities of retailers to hire up and create safe, secure places for employees and consumers.

Additionally, going into a bad budget environment, we want to ask you to invest in things that work, things that are cost effective. Law enforcement cells prisons are extremely expensive. We want to hold up the opportunity for diversion, pre-plea, pre-booking and post-conviction so that people don't have long term consequences which make them unemployable and unhousable. Convictions have long term consequences. That's also part of the discussion.

How can people be apprehended, held accountable, learn, but move on so they can still be employable, housable and have access to education? Thank you.

Thank you.

Good afternoon. Leslie Caldwell Houston from the California Public Defenders Association. I was a public defender, a deputy, and then ultimately running a Department for nearly 40 years. I lived through the what I call dark ages of the 90s. I had cases that nearly broke me and did break my clients.

I had a client who went to prison for 32 years to life for stealing $8.91. I do not want to see us go backwards and I am heartened to hear many of the comments. I do want to talk a little bit about perception. There was a comment about the public perception or x number percentage of people believe that retail theft or theft is a really big, important crime or issue.

And I want to speak to perception because I heard Police Chief after Police Chief on television in these kinds of hearings in the Assembly Public Safety Committee and the Senate Public Safety Committee over and over saying, well, we can't do anything because of Prop 47. When the public hears their Police Chief say that over and over and over, they're going to believe that the problem is because of Prop 47. I just want to reiterate, incarceration is not the accountability we need.

Thank you very much.

Good afternoon. Margot George, Co-Chair of the California Public Defenders Association Legislative Committee. Thank you for having this hearing. I think it was really informative. I do want to say that the things that have made a difference in my clients life are the diversion programs and the shifting of resources from prisons to other public goods: housing, education, mental health treatment. I believe those are the things that will change.

And in terms of accountability, I think that we heard today about ways of accountability that will stop this epidemic, if you want to call it that. And those are primarily corporate solutions and would ask you to extend the ambit of this Select Committee to address some of those issues. I think the cell phone example and the kill switch was brilliant. Closing down the markets on Amazon, Ebay. Those are the solutions. So again, thank you very much, and I'm heartened by your comments.

Thank you very much. Last one.

Thank you, Mr. Chair Members. Ryan Sherman with the Riverside Sheriff's Association and a dozen or so other local law enforcement associations. As some of the exhibitors here today from the Public Policy Institute of California recently reported, California's violent crime rate is 31% higher than the national average. That's according to the PPIC. Similarly, nationwide robbery rate between 2019 and 2022 declined about 18% during those years. However, in California, just declined just 6%.

Nationally, in California, property crime has been lowered. However, compared to pre-pandemic levels in California, we're actually higher, even though nationally it's gone down, I think about 8%. So those are some of the figures from PPIC. I hope you guys can take into consideration those I don't know that anybody's advocating right now for any one solution, just something that works. And we'd love to be partners with you as we start this next legislative year.

Thank you very much. So I want to thank everyone who provided testimony today, this concludes our public comment period. If any Members of the public who were not able to attend today or speak today would like to provide input, we encourage you to provide written testimony which can be sent to my staff as listed on the Select Committee website. With that, I'd like to turn to our closing.

And before I'd like to make my closing remarks, I'd like to give every Member here today the opportunity to make any final thoughts. I'd like to start with Assembly Member McCarty, and then we'll go to start on this side and work all the way through. And I'll conclude.

So, first of all, thank you, our Caucus Chair and Chair of the Select Committee, all things important to California. And again, thank our speaker for putting this panel together.

And I think it's fair to say that we have still many more questions than answers, and we'll get to that with our hearings coming up. But I think the clarity is inaction is not acceptable, and especially in regards to retail theft and repeat offenders. And I like what you said earlier. We don't have to go back to where we were in the 90s, some of the pulses we didn't like. But we need more balanced and smarter solutions focusing on accountability.

And I'm committed as a public safety chair with you and this Committee, and I know you're a Member of the Public Safety Committee, to working with our criminal justice reform advocates and law enforcement to come up with a real, reasonable, practical solutions moving forward.

And I will very shortly be introducing legislation dealing with this issue and revisiting Prop. 47 with some smart fixes, focusing on what we heard, which is more collaborative courts, more diversion, more programs to help people stay out of the criminal justice system, but also accountability on the flip side, if those aren't achieved along the way. So look forward to the future discussions. And thank you.

Pacheco.

Thank you, Mr. Chair. And I want to thank everybody who participated today. I found the information to be very valuable, and having these types of discussions are important for us to solve this very complex issue. It's not an easy solution. And so I really appreciated all the comments from the panelists and even the speakers who spoke today during public comment. I'm looking forward to further discussions so that way we can try to pass legislation to help ease this problem. I know it's not going to go away overnight, just like it didn't arrive overnight either.

It was years in the progress as to retail theft increasing. But I would like to work on solutions. So thank you all. But happy holidays, everyone.

Assemblymember Schiavo.

Thank you so much for convening this and the phenomenal panels and panelists, thank you for being here and everyone who participated today. I agree that we're leaving with a lot more questions than maybe we came with. But I think that we all agree. We know this is a serious issue.

We know that we need to respond to the real issues and also make sure that we're giving our community good and accurate information around misinformation that does exist. And I think that some of the good news out of this is that while there's a lot of questions, there's also some really clear answers about what does work and what is really effective. And so in a lot of ways, it's very clear coming out of this, we don't have to reinvent the wheel.

We know the things that are working and the things that can be really effective about cutting off the source of people, being able to resell things or around hardening that retailers can do, staffing those kinds of solutions, and also around diversion and early intervention really being the most effective as well.

So I'm really looking forward to continuing to work on this, looking forward to future panels and hearing what they have to say and bring to the conversation, and appreciate all my colleagues being here today to dive into this together.

Thank you, AssemblyMember Petrie-Norris.

Well, thank you again, Mr. Chair, for convening this hearing. And thank you to all of our panelists for participating. I thought our sessions and our conversation were incredibly informative. I learned a lot.

I think a couple of the things that I'm really taking away, I think one of our panelists summarized that the most powerful deterrent, whether we're talking about retail theft or anything else, is certainty of a consequence. And I think, as any parent who's had a toddler will tell you, a consequence-free world environment is not a way to build a functioning society.

But I want to also be really clear, because I think sometimes when people hear the word consequence, they think we mean, oh, gosh, we're going to lock everybody up and throw away the key. And I don't think anyone is saying that. I don't think anyone on this dais is saying that. I don't think anyone that we heard from today is saying that.

And one thread that I think really ran through our panels and we heard from folks that represented a cross section of positions on this issue was the importance and the effectiveness of diversion programs. And so I think the fact that over the course of the last 10 years, we've seen participation in diversion programs drop by some 67% is, for me, that is the big blinking light.

And I think figuring out how we can get people into diversion programs and change the course of that trend I think is going to be some really powerful work that this Committee can do. So again, thank you, everyone for participating and look forward to continuing this conversation.

Assemblymember Alanis.

Thank you, Mr. Chair. So again, as my colleagues have all said already, I want to thank the panelists that came up, Caitlin and Magnus, thank you guys for your intel on that. It was very helpful.

I think helped educate a lot of people up here with me. And Rachel with the California Retailers Association. Obviously a lot of data there. And I encourage to continue speaking with and my colleagues as well, working with them as well. And Jeff, thank you for your insight as well. That helped a lot, a lot of insight on that. And I thank you for that. And Ivy also for coming in, providing what you did kind of give them an insight on what goes on in the courthouse.

That's a big thing that a lot of people don't understand. It says one thing on paper, but to put it into practice, totally different thing. And as far as it goes with incarcerating them in the jail as opposed to the prisons with AB 109, that's also something that people are still trying to learn. What does that mean? I don't really understand what that meant, but that was a good explanation that you gave. So thank you for that.

And Chief, also thank you for being here as well and doing that. As you guys may know, today, we talked a lot about what we could do to help or ideas that came out. Self checkout was a thing. I see the Grocers Association is here, so I know that's one thing that I've spoke with them about. A lot of them are recognizing that the self checkout is something they need to work on to deter crime going on.

And they're doing their own thing as much as they can on their own. And I've gone and visited with other groceries and stores and even retailer stores and finding out they're doing their own thing to try and help deter crime in their stores. Petty theft with the prior, obviously, we talked about that today also, we need to bring that back. And diversion, diversion keeps coming up with my colleagues, and they're right, and I've seen it firsthand. I've been part of drug court.

I've been part of the diversion program. I've seen people's lives get turned around with it, and it's a real thing. And I'm very proud and happy to bring all that back as much as we can, but we can't bring it back unless we can get their seats in those classes. And the only way you can do that is with consequences. And so that's what we need to bring back.

I know this may not have been overnight, but we all voted for the Safe Neighborhoods and Safe Schools Act, right? And that was Prop. 47. And now here we are today reevaluating what it is and what it was about. And so I'm glad we're having these conversations. Chair, thank you for doing this. I'm looking forward to working more with this. And thank you. Happy holidays.

Thank you. So thank you, Members, for taking part of your holiday period to travel to Sacramento and spending time on this important issue today. I'd also like to thank our panelists and Members of the public and the support staff that made today happen, including the sergeants and technological and communications experts that are behind the scenes, the speaker staff, and my own personal staff. So I want to thank them.

What is happening in our communities is unacceptable, and we know that we need to act with urgency, but we also know we must look at facts and find solutions that actually work. Today we heard a lot of important information from a variety of perspectives. We heard that there may be gaps in our laws and enforcement systems, especially with respect to organized repeat offenders and misdemeanor enforcement. We've heard from law enforcement that they may not have the resources that they need.

We heard that one of the areas that we should focus on are preventive measures and diversion programs. And we heard that increasing penalties may not result in the deterrence we're looking for. We've heard from representatives of our workers and the retailers, too, that we need to find solutions that don't put workers in harm's way. And we've heard from property owners of their urgent concern that shopping centers are on the verge of--

Some shopping centers are on the verge of failing, as large retailers withdraw and small retailers who depend on them struggle and also fail. And we know that this is just the beginning. We'll be delving into the changes that may be required in the law, understanding in more detail how we can increase enforcement of the laws that are in place, exploring diversion programs and hearing from people on the ground in local jurisdictions.

In my life and career, I've come to understand that we tend to agree on more than we do not. Our families want the same things, the same opportunities, and the same shot at the American dream, and we need to work together to achieve that. We're also more likely to come to the best solutions when we listen to all perspectives, have genuine conversations with each other, and make sure everyone is heard. That's what we endeavored to do today.

And this hearing is evidence that many of you feel just as invested as I do in responding to this difficult problem. With that, happy holidays, and thank you very much. This hearing is concluded.