Assembly Standing Committee on Judiciary

Welcome everyone to the Assembly Judiciary Committee. Apologize for being a few minutes late, had to go sign in in another Committee in order for us to complete our agenda and allow everyone equal time. The rules for witness testimony are that each side will be allowed two main witnesses.

Each witnesses have approximately two minutes to testify in support of or opposition to the Bill. Additional witnesses Witnesses should state only their names, organization, if any, and their position on the Bill.

As you proceed with witnesses and public comment, I want to make sure everyone understands the Committee has rules to ensure a fair and efficient hearing in order to facilitate the goal of hearing as much in the public within the limits of our time. The rules for today's hearings include no talking or loud noises from the audience.

Public comment may be provided only at the designated time and must be limited to your name, organization, support or opposition of a Bill before the Committee. Comments on other issues will be ruled out of order and the microphone may be disconnected. No engaging in conduct that disrupts, disturbs or otherwise impedes the orderly conduct of this hearing.

Please be aware that violations of these rules may subject you to remove from the hearing or other enforcement processes. And we'll go ahead and start with Mr. Lowenthal. AB2 file item two. All right, whenever you're ready.

Thank you. Mr. Chair and Members, I am pleased to present AB 2, which will hold social media platforms accountable for the harm they cause children and teenagers. Thank you so much. This legislation would impose financial responsibility on large social media companies if their own negligence has been proven in court, and only if their own negligence has been proven in court. I would like to start by thanking the Committee staff for their work and thoughtful analysis on this Bill.

I find myself compelled as a parent and a Legislator to bring this piece of legislation back. Because despite the Legislature's diligent efforts to thoughtfully address the harms of negative impacts social media platforms have had on the mental health and well being of children and teens, we are still struggling to hold the platforms accountable through regulation.

Children, parents, researchers, doctors, regulators and lawmakers alike have clearly delineated the problem. Social media platforms are causing untold harm to our kids. And what's worse is that the platforms know that their product is harmful and addictive. Exposed internal studies and documents have revealed that Meta, TikTok, Snapchat are all undeniably aware that they are exposing children and teens to addiction and to harm. But our pleas for social media platforms to self regulate have gone unanswered.

Our attempts to regulate the platforms are being challenged by the platforms and their trade associations in the courts and the public is demanding action, which is why AB 2 is so critically important. Unfortunately, social media platforms continue to deny that their algorithms, their design features are contributing to these harms. In fact, some platforms seem to be flagrantly ignoring the problem we have identified by actively rolling back what little safeguards they previously offered.

Earlier this year, for example, Mark Zuckerberg announced that Meta would be getting rid of fact checkers, the platform's human based content moderators, dialing back automated content filters that flag and limit the discussion dissemination of false and harmful content, and would be replacing those safety features with a community note system where users will determine the veracity and potential harm of posts and content.

The video statement issued by Zuckerberg in conjunction with Meta's announcement, he noted in regards to the proposed changes and their impacts on content moderation, 'it means we're going to catch less bad stuff'. I don't think Mr. Zuckerberg could have said it any more clearly. Meta's announcement is just the latest in a troubling pattern among social media platforms that consistently puts child safety second to maximizing profitability and shareholder value. California and this Legislature are not alone in our concern.

The Federal Government, along with multiple states and many of our allies overseas, are actively seeking ways to hold social media companies accountable for the negative impacts their platforms have on the well being of children and teens. Recent congressional hearings and an alarming number of studies point to the negative impact social media can have on a child or teen's development, mental well being, and health. More must be done, and fast.

Last year, one of the opponents to AB 3172, which is the previous version of this Bill, AB 2, described the Internet and by extension social media platforms, as a mirror that reflects the underlying harms and ills of our society. Now, there's some truth to this description, but I think a more apt metaphor to describe social media is that of a bullhorn. Like a bullhorn, social media has the ability to both amplify and distort social ills and harms.

There is no other outlet in existence that allows individuals to disseminate such information, true or false, good or bad, helpful or harmful, to such a wide audience, with so little oversight and accountability. On a social media platform, we have no guarantee that the information we're receiving is true and accurate.

And if it turns out to be false, misleading, or leads to our harm, we have little to no recourse. And that's just how the platforms want to keep it. A reasonable person would not suggest that, to a child, that Anorexia is a good weight loss solution, that steroids are a good way to build muscle and get fit, that driving at dangerous speeds to impress your friends was safe, that choking yourself until you pass out is a good idea, or that self harm or suicide were good ways to deal with depression.

Doing so would not be exercising ordinary care. Well, the proprietary algorithms and design features used by social media platforms are fully capable and have done exactly that. They drive children and teens to harmful content, encouraging them to engage in dangerous, sometimes life threatening behavior. While social media companies may not be the publishers of harmful content themselves, they're the creators of the algorithms that push this harmful content onto the screens in our kids hands and this is a failure to exercise ordinary care. Social media platforms can and must do more to protect our kids.

AB 2 will hold social media platforms accountable for their failure to exercise ordinary care that results in harm to children and teenagers. AB 2 does not change California's underlying law or the burden of proof required in court. It does not change existing law. What it does do, in response to the damage knowingly and admittedly being done to an entire generation of children by just a handful of companies that are earning enormous profits off of children and teen users, is apply appropriate financial incentives and accountability to prompt these few companies to be more careful, responsible partners and especially when it comes to children. Our top priority must be ensuring our children are safe and secure offline and online.

I don't need to tell you that millions of teenagers and children turn to social media apps as their primary form of interaction and communication, and it's imperative that we are certain they are safe in doing so. Now is a good time for me to remind everybody that children are spending on average 5 hours per day online, on average. So for those of us parents that are restricting our kids to two hours or less, think of all the children that are online 8 hours, 9 hours, 10 hours more per day.

As a former social media company shareholder and someone who has spent a career in the tech industry, I believe in the potential for these companies to promote the healthy development of our youth and be a benefit to all users. But as a parent and as a Legislator, it's my responsibility to stand up and demand accountability and real action when they claim they want to protect our youth. I should make myself clear. I'm not against social media.

In fact, as a parent of young children, I see the positive effect some social media tools can have in connecting young people. I just want social media companies to much more vigorously step up to the plate and be responsible partners that take safety and well being wellness of our children as serious as they do their profits. AB 2 will make social media companies more responsible for their own algorithms and actions that affect our kids and more accountable when there is proven negligence in court. I am pleased to be joined by Nicole Rocha who is here to testify in support of AB 2. Thank you.

Good morning. My name is Nichole Rocha. I'm here on behalf of Common Sense Media. Every person in California has an obligation to avoid reasonably foreseeable harm to others. This is the common law of negligence and it is codified in the Civil Code. Social media companies are already subject to this statute and are litigating cases under this section in both state and federal courts. Unfortunately, the actual damages plaintiffs have traditionally been able to prove in these cases have not been high enough to deter harmful behavior by some of the most profitable companies in the world. AB 2 is simple.

It builds upon existing law and creates enhanced financial penalties for large social media companies who have breached the ordinary standard of care causing harms to children through their negligence. The opposition today will argue that ordinary care in this context is ill defined, making it inappropriate to subject them to increased penalties.

They will argue that this Bill is unconstitutional content moderation and that the Bill is preempted by Section 230. These arguments are nothing more than a red herring by industry seeking to ensure their liability remains disproportionately small compared to their profits. Social media companies fail to meet the standard of care when they have reason to know that their products are harmful but fail to mitigate those harms. The opposition will argue that this Bill is content moderation that will ultimately subject kids to surveillance and shrink the universe of information available to them. But this Bill does not regulate content.

Which brings me to Section 230 which provides specified immunity for publishers of third party content. It does not provide immunity for all business decisions such as features that the platform chooses to offer to the public. Courts are trained and accustomed to determine whether a claim is barred by the First Amendment or Section 230. Should this Bill become law, that process would not change.

Claims based on the publishing of third party content would likely be barred by the First Amendment or Section 230 and claims based on negligence unrelated to content would be permitted to move forward. This Bill is simple. It creates right size penalties to ensure kids well being is acknowledged by social media companies as required by existing law. It deserves your aye vote. Thank you and I'm happy to answer any questions.

Thank you. Thank you. Is there anyone else here in support of AB 2.

Kim Stone, Stone Advocacy on behalf of the Children's Advocacy Institute at the University of San Diego Law School in enthusiastic support.

Thank you.

Good morning, Mr. Chair and Members. Pamela Gibbs representing the Los Angeles County Office of Education. And we strongly support the Bill. Thank you to the author.

Thank you.

Good morning. Mikey Hothi, on behalf of Common Sense Media, proud to sponsor this effort. Thank you.

Thank you.

Xavier Maltese with the California Charter Schools Association in support.

Thank you.

Mariko Yoshihara, on behalf of the California Initiative for Technology and Democracy in support.

Thank you.

Good morning. Teri Olle, Economic Security California Action in support.

Thank you. Is there anyone here in opposition AB 2. And while you make your way up, if I can ask the secretary to establish quorum, please.

[Roll Call].

We have quorum established and go ahead and you may begin whenever you are ready.

Great. Thank you. Mr. Chair. Good morning, Members. Dylan Hoffman, on behalf of TechNet, respectfully opposed to AB 2. And first and foremost, I want to say that our platforms are amongst the companies that are at the forefront of designing their platforms better and trying to mitigate many of the harms that have been discussed today. We've done this voluntarily, we've done this for decades, and we'll continue doing so because it's the right thing to do.

So part of that is rather than, I think, looking at some of the penalties of this, I think trying to think about what the, what the goal of and what sorts of specific harms we're trying to address. I think when we're talking about, you know, this sort of duty of ordinary care, how is a company supposed to operationalize that? I think when a company is trying to incorporate this, their response to, for example, cyberbullying is going to be very different than, say, fraud. But you, under this Bill, you've got increased penalties for both.

And the amount of litigation this is going to incentivize just based on that high penalty, I think is going to create a flood of litigation. And by itself that is going to increase costs on companies and really frustrate the efforts of these platforms to try to mitigate most of this harmful content. So I think where the proponents maybe miss the incentive here is how is a company going to respond to this type of liability? I think where the difficulty in seeing how a company can limit their liability is just based on the difficulty of moderating content. Many of the examples brought up today were based on content.

And I know that on its face this looks like a content facially neutral Bill, but when we're talking about recommending certain types of content, eating disorders or things of that nature, it's coming back to that. So how does a company try to do that? So I want to just finally reiterate. It's not clear entirely how a company would limit that liability without taking some of these aggressive actions to either limit access for teens or to limit the content itself. And that's why it's ultimately unconstitutional and raises those problems.

Thank you.

Thank you for the opportunity to speak today. I'm Aodhan Downey. I serve as a State Policy Manager for the Computer and Communications Industry Association (CCIA and International Not For Profit Tech Trade Association. While CCIA agrees with creating measures to protect children from potential harm, we have concerns about the unintended consequences of the Bill.

Social media companies will struggle with the amended Bill Language of causing injury, while being accused of inventing and deploying features that they know will injure large numbers of children, in Section 1 of 1714. There would be broad, sweeping repercussions for minors access to information and digital privacy across California to prevent frivolous litigation claims against social media platforms. Every aspect of a platform, its features, user interactions and the content a minor sees could potentially lead to a lawsuit.

Reasonable people may disagree on what is harmful to a particular minor, especially their parents or guardians. AB 2 demands that social media platforms define harm for all users and take appropriate measures to prevent it. This is an untenable tax that will only lead to more frivolous lawsuits. To speak more on sort of Dylan's Comments, one of CCIA's greatest concerns about the Bill would be the potential removal of end to end encryptions on social media platforms.

The impossible standard of care that this Bill sets would incentivize social media platforms to stop end to end encryption out of fear they might be sued based on something one user shares with another user completely out of their control. CCIA and its Members want to create a safer environment for minors online and removing this commonplace feature would open miners up to more risk of increased surveillance, data breaches of sensitive information, government or third party access to private messages, even if you don't add them to the group chat and most importantly would create a chilling effect on free speech among young people.

Lastly, section 230 protects online platforms are being held responsible for content created by users, allowing them to host and moderate content without constant fear of lawsuits. If this protection didn't exist, the Internet would be a very different place, with far fewer opportunities for users to share and interact.

AB 2, however, tries to hold platforms liable for features that expose users to content, essentially treating all platform features as potential risks. But since these features are closely tied to user generated content, this directly conflicts with Section 230. Because federal law overrides conflicting state law, AB 2 is likely preempted and wouldn't hold up legally. We appreciate the Committee's consideration of these comments and request a no vote. Thank you.

Thank you. Is there anyone else here in opposition to AB 2?

Morning, Mr. Chair. Chris Micheli on behalf of the Civil Justice Association of California, in respectful opposition.

Thank you.

Good morning Chair Members Dani Kando-Kaiser, on behalf of the Electronic Frontier Foundation, in respectful opposition.

Thank you.

Ben Golombeck with the California Chamber of Commerce in opposition.

Thank you. All right, we'll bring back the Committee. Any comments, motions> Assemblymember Zbur.

I'll move the Bill.

Do we have a second?

Second.

Thank you, Assemblymember. I think this is an important Bill and I think you're the perfect person to bring it. And I know that the, as someone who also has teen kids, as I do, I know how important it is to make sure that what they're seeing on their screens is not harmful. I do have some concerns about the Bill and they're along the lines of some of the concerns I had about some other bills that came about last year. And that is that it's, I think the Bill is vague in terms of what constitutes harm for a kid.

And I worry about folks that actually are trying to prevent kids from accessing websites like the Trevor Project or like a Quality California and would could make a claim that actually those websites in and of themselves because they embrace the LGBTQ community are harmful. So I'm hoping that you would be willing to work with Equality California and the Trevor Project and some others in that space to make sure that this Bill is fine tuned.

Mr. Chair, may I respond?

Yes.

It is so meaningful to have your support, Assemblymember, because of the decades that you have spent dealing in this arena. Digital life, you know, analog life, all of it. And so I really appreciate it and I take your concerns to heart and absolutely would be willing to work with anyone and everyone to strengthen this legislation. This Bill does not change what determines harm or what doesn't. Just so you know. Those are established in law already and those harms have to be proven in court. It is the same duty of care levels as any consumer product that any child uses. Anywhere. And so - but beyond that, absolutely, we'll work with anyone and everyone to try and make this better and would welcome a warm handoff for that.

I have complete confidence in you. But you know, there's some that would assert that visiting a suicide prevention website that is aimed at LGBTQ kids is harmful. I mean, they're just, there will be people that will assert that. So I do think that there needs to be more guardrails about what that is. And I have complete confidence that you'll do that. And I know, you know how aligned you have been and an advocate for, for all kids, frankly. So I will be supporting the Bill today.

Thank you. Any other questions, comments? Assemblymember Harabedian.

Thank you, Mr. Chair. Thank you to the author for bringing the Bill. I think it's long overdue and I do think that many of the principles and the intent behind it are great. Frankly, it's a remedies Bill. I think that a lot of the arguments as to changing the standard on liability are just not founded in the Bill or evidence. And I also think that this is a time for the opposition to come to the table and talk about solutions that could work for everyone.

And I think this conversation was obviously happening last year and I think that it should be happening this year. In terms of the federal law that applies here. I think that is long overdue to be changed as well. So hopefully this will push Congress to actually do something with 230, to actually do something with the safe harbors which were frankly written at a time that didn't actually account for the world that we live in now. The algorithms and a lot of things.

And you know, on the First Amendment, you know, front, I don't think the founding fathers were very worried about a 16 year old being able to use social media. So frankly, if the opposition says that this would lead to those under the age of 18 being able, being unable to use social media, God bless them. Frankly, with three kids under the age of 10, I hope we live in a world like that. So thank you for this Bill. I will be supporting it and happy to move it.

Other questions? Comments? Assemblymember Tangipa.

Thank you. And while I do understand and there is a lot of data out there that shows harms that social media or at least being on social media platform has had a negative effect, especially if you look at 2007 and beyond, could you provide an example of what ordinary care or skill or reaction between two individuals that then would shift the burden onto a social media platform that they'd be liable.

Assemblymember, would it be okay if Ms. Rocha answered that question?

Of course.

Sure. One of the cases referenced in the analysis is Snap v. Lemon, where Snap was ultimately held liable because they created a filter that clocked the speed at which folks were taking pictures. And so ultimately they were found liable because it would encourage users to like drive faster. Right. And so a child died in a car accident and they were found liable.

They're found - so even if they're a passenger in a seat and they use that filter, that would be on the social media company.

Mr. Tangipa, if I could just answer really quickly. There are cases happening right now in this area. This Bill doesn't change that. There are many cases throughout the court, State of California and throughout the United States actually where negligence is being shown, harm is being proven in court. There simply aren't damage levels that are assigned.

This assigns set damage levels the same way that you see in almost every consumer product that kids use, the same way that you see in an airplane ticket when you're going to fly, the same way you would see for automobiles. That safety is paramount in the product development cycle. With those damage levels set, it changes the incentive so that the focus is on safety and wellness. Creates an environment where you want to have crash test dummies, where you want to show to the public how much safety measures that you've taken in designing the product itself.

And I understand that, again safety is paramount, and with it seems like this the window that social medias have to prove on their end, I think that there are safeguards that we do need to protect children. I think this just opens so large of a litigious window that shifts the burden of proof onto what platforms seem as just a platform where a lot of people and especially as we move into shifts with Web3 that communities are now built online, they're more host platforms for what engagement can be.

And so for me, and I understand, I mean I grew up in the age digital where social media was coming out into the forefront and where individuals and I've seen shifts in people, I even see it in my nieces and nephews. But it's something that I've been able to talk to my sister and the parents that provide those platforms or provide the phone that the burden of protection for their child is on them.

Where this shift seems to me shifts really the goal of now government comes in and usurps the parents role where I think the parent needs a little bit more action on that part. It's something that I've had multiple conversations with my family about. I don't believe that people under the age of 14, especially in the middle school era, should be on social media. I just don't believe that's the government's role to come in and move even more and really create this broad window that is overly litigeous.

Yeah, I appreciate your comments. It sounds like we want to get to the same place, right? Very respectfully, Assemblymember, there is no shift in the burden of proof. There is no change at all in the law here whatsoever. This does not create any level of shift of government. It does not increase government's responsibility whatsoever. For the cases that are ongoing right now, it gives judges some guidance of what the damage should be. Only if harm is proven in court. You know, harm can be $5,000. It does not have to be gazillions of dollars.

And so we need to allow the courts to do what they can and what they should. The reason why I'm talking about the harms and what's happening with social media is because the data is empirical today. Collectively on what's happening with youth mental health - it's awful. Suicide is up 60% from young people in the last 10 years.

Eating disorders, same. Anxiety and depression, even higher. And especially for girls. We are in a crisis. Different jurisdictions are handling it differently. The nation of Australia just outlawed social media for youth under age 16. We in California don't feel like we should be taking. I don't feel like we should be taking such draconian measures.

As we heard from your colleague, there are many parents out there that are willing to take the draconian measures as long as it means the safety and wellness of their kids. What we're simply trying to do here is give the courts tools and guidance as to what they can and should do when harm has been proven by negligence in their courts. We're not changing law here whatsoever.

Thank you. Madam Vice Chair. All right, Assemblymember Papan.

Well, I want to thank the author. I know we've had extended discussions about this as parents, and I've so appreciated our exchange. So I'm going to make a couple comments. Number one, as you know, my district, I represent a lot of tech, and I know how my district feels about such regulations, and they're not with the tech industry. Most of the folks I represent are parents, and they're experiencing the same types of difficulties that you and I have shared so intimately. And ultimately, you got to prove your case in court. And I appreciate the distinction that you're making here because the tech industry has long been about don't regulate our content. Fair enough, I get it. But if the case has been proven, and I love the way you've nuanced this, then we're going to accept the penalties.

I'd like to see you all get on board actually, because when you got legislators that are trying to get away from the regulation of content and really just allow this to happen in a court of law, as most liability ends up after it leaves the Assembly Judiciary and gets on the floor and gets to the other side and gets to the Governor's office, it should be allowed. So these are the ones that I think you guys can get on board with, quite frankly. And I would prefer to see that rather than have some opposition. So I applaud it. I'll be giving you an aye vote. And here's the parenting.

Assemblymember Stefani.

Thank you, Chair. I want to thank the author for bringing this Bill forward. As a mother to a 20 year old son and a 15 year old daughter, I feel this Bill is extremely important. Although I think my children are next to perfect, I do know that they have gone through various things in high school and continue to. And as a mother who wants to help my children at all costs, I have researched online how to do exactly that. I am on these platforms and I have been shocked at the ads and the content that I see just in my attempts to help my own children get through whatever they may be going through.

You've mentioned a few things and I think as parents we all unfortunately have had to guide our children through many difficult situations. And the fact that I get content that is so absurd when I'm just trying to help my own children on how to harm myself or how to do other things is actually baffling to me.

So I think that I want to align myself too with Assemblywoman Papan's comments. In terms of tech is very important, but at the same time we have to find ways to help our children. I can't fathom why anyone wouldn't want to do everything possible, given what is going on in our society today, to help our children. So again, I thank the author for this Bill and I will be supporting it today.

Anyone else? Thank you. I also want to thank you, Assemblymember. This is, I know an issue in protecting our children is a hallmark of your work here in the Legislature. And I do believe, as others have said, that there is a responsibility, particularly when you have platforms that are intentionally trying to attract more viewership from the youth. I think that does come with the responsibility as well. And it is - I know it's a challenging Bill to take on, but I know, I'm confident that you are the one that can make this happen. Would you like to close?

I do. I want to thank everybody for the thoughtful discussion, the thoughtful comments. I'm very proud that this is a bipartisan Bill. When it went through the Legislature last year, bipartisan, unanimous at every stop until we ultimately pulled it out of Senate Appropriations. And I am very hopeful that we'll have the same outcome this year with a lot more co authors on board. I want to thank the opposition. They have a tough job here. I can't think of any single human being who's with them on this topic. It's a tough one.

I know that there are thoughtful, caring decision makers inside tech companies that are parents themselves that grapple with this on a daily basis. And I want to make sure they hear me today when I say we want your companies to be more successful than they are now, not less successful. We want them to grow.

We simply want to be aligned in our incentives and we want to find ways to level set and right set the situation. The opposition focus so much on content. What about moderating the amount of time that kids are online? How about usage during school hours? How about usage through the night every single night?

How about the issue of addiction? How about the issue of age verification? How about ID verification? There are so many different ways that harm is being caused outside of content itself. I'm not here to lay out all the current youth mental health crises or society's problems at the feet of social media platforms.

But that does not mean that there isn't a problem and that there isn't a correlation between social media and the modern prevalence of these problems. Report by the CDC on suicide rates between 2001 and 2021 found that the suicide rate among young people age 10 to 24 remained stable through 2001, 2007 and then at 2007 increased 62% until 2021. Suicide rate for people age 14, excuse me, age 10 to 14 declined. It declined from 2001 to 2007 and then it tripled from 2007 through 2018. It's remained constant since then through 2021.

The suicide rate for people age 15 to 19 did not change significantly from 2001, 2009 and then it increased 57% from 2009 to to 2017. From 2017 to 2021 this trend did not change significantly. So we see we know precisely what this macro data is telling us. The same time as suicide rates amongst these age groups began to spike, social media use exploded.

2006, Facebook opened to the general public for users 13 years and older with a valid email address. Instagram launched on October 10, 2010. In 2011, Snapchat launched as Peekaboo. And in September 2017, TikTok launched for international markets. We need social media to recognize this problem, take accountability for their role in it. I respectfully ask for your aye vote.

Thank you, Madam Secretary for the roll call vote and AB 2, please.

Motion is due passed. [Roll Call].

All right, that Bill is out. Thank you. On to item four. AB 282. Pellerin.

You may begin.

Okay. Good morning. Thank you. Chair and Members for the opportunity to present AB282, I will be taking amendments in committee. The amendments clarify the unclear term prioritize and permit a landlord to establish policies or preferences in favor of applicants or tenants who qualify for federal, state or local housing subsidy programs.

Historically, housing choice voucher holders, formerly Section 8, have had difficulty finding a unit in the private rental market. This includes blatant refusal from some landlords to rent units to tenants with a voucher. In 2019, Governor Newsom signed SB329 by Mitchell to redefine source of income to include housing subsidy payments.

As a result, it is unlawful for the owner of any housing accommodation to discriminate against any person because of their source of income. This was drafted in acknowledgment that voucher recipients face discrimination and stereotyping based on their source of income.

Although SB 329 was an important step in combating housing discrimination and expounding expanding housing opportunities for families with a voucher, the law, as currently written, prohibits discrimination against households with rental assistance. It also prohibits establishing a preference that benefits households with rental assistance.

So AB 282 will allow housing providers to establish a preference preference for voucher households by explicitly stating that the prioritization of applicants for tenancy who qualify for or participate in rental assistance programs does not constitute discrimination based on source of income.

And with me to testify today is Jenny Panetta, the Housing Authority of the County of Santa Cruz, and James Johnson, General Counsel for the Housing Authority of the City of Los Angeles.

Thank you. Good morning, Chair and Committee Members. My name is Jenny Panetta. I'm representing the Housing Authority of the County of Santa Cruz and the California Association of Housing Authorities, both of whom are proud co sponsors of AB282. AB282 does two things.

It expands housing opportunities for recipients of rental assistance, and it also offers another tool for housing providers. As administrators of the Housing Choice voucher program, we see every day the challenges that voucher households face when they're out in the rental market looking for housing. Fierce competition for too few units.

And all of that is compounded by a landlord reluctance to accept accept vouchers. AB282 would allow mission-driven housing providers like housing authorities and nonprofit organizations to establish a preference for voucher recipients. This increases the housing opportunities for voucher households, and it also helps housing authorities to fully utilize federal housing funds.

This Bill also supports the financial stability of affordable affordable housing. Many affordable properties rely on project based vouchers to meet their operating costs. Unfortunately, project based vouchers are scarce, putting developments at risk. AB282 would provide another tool to keep these properties financially viable.

By addressing the needs of both low income families and housing providers, AB282 creates a stronger housing market for the State of California. I respectfully urge your support. Thank you so much.

Can we have a motion and a second?

Good morning Chair Kalra and Members of the Committee. I'm James Johnson, General counsel of the Housing Authority of the City of Los Angeles, also known as HACLA. HACLA is the second largest public housing authority in America and and the largest provider of affordable housing in Los Angeles.

I've come here to support our agency's support for AB202 which would help our largest affordable housing program, the Housing Choice Voucher Program. These vouchers provide vitally needed affordable housing for over 54,000 families in Los Angeles and are a critical tool in our fight against homelessness and housing insecurity.

Today, only about 60% of of the housing choice vouchers HACLA issues are used by program participants. In other words, in a City of nearly 4 million people, 4 out of 10 new program participants are unable to find a single apartment after searching for at least six months.

Imagine what this is like for our program participants who've waited up to five years for waiting list lottery, were part of the lucky 13% to win that lottery, then wait additional years to finally be given their voucher for affordable housing, only to spend months looking for and not being able to find a single apartment in the entire city and have their vouching expire, their voucher expire.

This is what our housing crisis looks like. And while we're making progress, it'll take a wide variety of policy initiatives, including more housing, to address it. This Bill would help families and individuals with those housing vouchers and allow landlords to voluntarily offer a preference so they can be successfully housed.

Providing this preference would also help HACLA and other PHAs more efficiently administer their program. We want our time and energy to be used to provide housing, not to recycle unused vouchers. Thank you for consideration.

Thank you. Is there anyone else here in support of AB282?

Good morning. Kiara Ross on behalf of the city of Burbank in support of the Bill.

Thank you.

Good morning. Keith Coolidge on behalf of AARP California in support of the Bill.

Thank you.

Good morning. Anya Lawler on behalf of the Public Interest Law Project, the California Rural Legal Assistance Foundation and the National Housing Law Project in support.

Thank you.

Catherine Charles, on behalf of Housing California, in support.

Thank you.

Karen Sun, on behalf of Power California Action, in support.

Thank you, Mr. Chair. Members, Rand Martin, on behalf of the AIDS Healthcare Foundation and its Housing Is A Human Right division, in strong support of this Bill. Thank you.

Thank you.

Good morning. Erin Evans, on behalf of the County of Santa Clara, in support. Thank you.

Thank you. Is there anyone here in opposition to AB282? All right, we already have a motion. Any questions?

Alright. Well, thank you, Assembly Member, for bringing this Bill forward. Would you like to close?

I respectfully ask for your aye vote.

Thank you.

Motion is do pass as amended to appropriations.

[ROLL CALL]

That Bill is out. What was that? I don't know.

Madam Majority Leader and other Members here, I'm going to ask if you would consider allowing us to have Senator Papan go, since she shares a meeting in 10 minutes.

Sure.

Thank you so much. Thank you. I know you've been here for a long time. Thank you. And Assemblymember I, I appreciate you.

I, I just wanted to get permission from our, yeah. Assemblymember Papan.

I owe you.

On the record

On the record. I owe Majority Leader one.

As this is AB 882.

I have a couple witnesses. As they make their way forward, perhaps I'll begin. Mr. Chair, thank you so much. ABA 882 is about accuracy and availability in the world of court reporters. So let's talk about accuracy first.

Court reporting and voice writing are the most accurate ways of reporting court proceedings, and they are the only records considered official for purposes of appeal. The inadequate alternative to court reporters is electronic court reporting. But it has its limitations, with markings for things like inaudible and unintelligible.

Unintelligible like if you're, you know, rustling your papers next to the microphone, et cetera. As such, for nearly 30 years, California has restricted the use of electronic recording in court in courts, allowing it only in specific cases like limited civil, misdemeanor and infraction cases, when a court reporter is unavailable.

Availability has been an issue because of a lack of hiring, not a lack of resources. Between 2009 and 2012, courts statewide laid off their civil and family law reporters due to budget cuts. However, once those cuts were were restored, most courts didn't rehire these positions. This failure to hire had profound effects on the reporting profession and litigants.

It slowed the number of people entering the profession, leaving litigants without access to the verbatim reporter transcripts. To address this shortage, the legislature has authorized voice writer licensure and provided $30 million in ongoing funding to recruit and retain reporters. As such, there's actually been a 250% increase in new reporters.

And by the way, just for the record, the. The voice writer, that's where you see in courts that there'll be somebody talking into a microphone like this, hearing everything that's there. And again, the accuracy rates with that is better than the electronic.

All right, so AB 882 acknowledges the availability issues and is designed to tide us over for three years while we increase the number of court reporters. In current law, electronic recordings can be used in limited civilization, misdemeanor and infraction cases when a court reporter is unavailable.

In this bill, we temporarily expand it to family law, probate and civil contempt cases if a litigant requests an official court reporter and one is unavailable. AB 882 is a crucial step in ensuring accurate, reliable records in our courts while addressing the vacancies and availability issues.

It balances providing a temporary solution with maintaining the integrity of the judicial process. AB 882 ensures everyone in California has a fair and transparent access to justice. The answer is not just summarily increase the use of less accurate electronic recordings. There are a number of stakeholders that have raised concerns, and we're committed to working with them.

Just so you know, I am adopting an urgency clause to the bill, given the urgent need for clarity in the statute. With me here to testify in support I have Stacey Gaskill of San Mateo. That's right, my hometown court official court reporter, and Sandra Barreiro, who is with SEIU. So let's start with Stacy. Welcome from San Mateo.

Thank you. Yeah. Okay. Good morning, Mr. Chair and members. My name is Stacy Gaskill. I've been a licensed shorthand reporter for 29 years. And in July of last year, I became duly licensed as a voice writer. For the last 25 years, I've been employed by the San Mateo County Superior Court.

I'm a Member of SEIU Local 521, and I'm also a board member of the California Court Reporters Association. I'd like to start by sharing some thoughts with you about who we are as court, as court reporters and what this bill means for the creation of accurate transcripts.

Court reporters are comprised of business owners, heads of household, primary income earners, to name a few. And we are a female dominated profession. Our licenses require that we create and certify 100% accurate transcripts. We are heavily regulated and we can be charged with a misdemeanor for certifying inaccurate transcripts.

The state of California demands justice be fair and accurate. That can only be met if court records are verbatim and complete. There's been a lot of chatter about the so called court reporter shortage. The issue has always been a recruitment and retention problem. There have always been enough reporters to staff judges.

Thanks to you and Governor Newsom, the court reporting profession is experiencing a revival due to recently enacted legislation and and funding to hire more court reporters. According to the California Court Reporters Board, the number of new licensees has grown by 250% just in the last two years.

Court reporting schools are also reporting their capacity and even some have waiting lists. And just as a side note, I looked on the Court Reporters Board website last night and just this year alone, 2025, there are 98 new licensees, which is. Which is more reporters that have been licensed in the past five years in its entirety.

We are sworn officers of the court and we take very seriously our jobs as guardians of the record. As such, I want to be perfectly clear that I don't love this bill, but I do see its merits.

Quite a support witness. Thank you.

Yeah. It has merits. And it does have merits. However, I'm very nervous for the litigants that will get transcripts derived from court recording. Court recordings derived from recordings. Because we know those recordings do not create a verbatim record. They are filled with missed testimony, insertions of inaudible and intelligibles. We're on a slippery slope. Okay.

And we need 100% accurate transcripts.

All right, thank. Thank you so much. It'll be some time for the other witness. Thank you. Please. Appreciate it.

I know why you didn't like it.

Thank you. Mr. Chair and Members Sandra Barrera on behalf of SEIU California. I'll address the opposition's claims. But first, the scope of AB 882 is publicly employed court reporters and the expenditure of public funds. Some of the opposition is based on the fact the bill doesn't. Doesn't include unlimited civil matters.

But those are covered by private sector court reporters. The opposition will also claim this bill violates the separation of powers. But it's the judicial power to decide cases which is not implicated in this bill. It's the legislature's power to enact statutes governing court administration. And that's established in Article 6, Section 6 of the Constitution.

The courts have ignored the transcript access crisis for 13 years since court reporters were laid off. And this demonstrates exactly why legislative intervention is needed to address shortsighted administration. Contra Costa Superior didn't hire a single court reporter for 13 years. Up until recently, it took LA Superior six months to get back to any interested court reporter applicants.

The opposition will claim that this prohibits purchasing of electronic recording equipment. That's not true. It simply closes a loophole in that provision. And additionally, the judicial council informed us that all of the equipment used for remote proceedings comes integrated with electronic recording.

And lastly, the opposition will claim that this bill doesn't apply to all family law and probate matters. That is not our understanding, but we've asked for amendments to clarify. We have yet to receive any and we are also looking for amendments to make the process easier for litigants and hopefully we will be provided with those.

I'm joined with Michelle Castro to answer any questions and I respectfully ask for your I vote. Thank you.

Thank you. Is there anyone else here in support of AB 882?

Good morning Mr. Chairman, members. Ed Howard on behalf of the California Deposition Reporters Association of California, California small business people, overwhelmingly women in strong support. Thank you.

Thank you. Is there anyone here in opposition to AB 882?

Good morning Mr. Chair and members. My name is Casey Johnson. I'm an Executive Committee Member of the Consumer Attorneys of California and I'm here to respectfully oppose AB 882. We fully recognize and deeply respect the invaluable work of certified shorthand reporters. However, California is facing a court reporter crisis that is now denying access to justice in courts.

Courts across the state have held more than 1.5 million hearings without a verbatim record since 2023 and the courts are currently short nearly 700 full time reporters.

The severe lack of court employed court reporters represents a denial of due process and access to justice, particularly for low income litigants who lack the resources to hire private court reporters to serve as reporters pro tempore.

In addition, our own members report that the cost of bringing a private court reporter into court can reach $5,000 a day, which is prohibitive in many cases and forces people to make the impossible choice to forego the protection of a record altogether.

AB 882 attempts to address this, but unfortunately, the bill is too narrow as crafted and creates excessive barriers. It only applies to litigants who qualify for fee waivers and only in a very small subset of cases. As it stands, this bill excludes critical proceedings like child custody, civil rights enforcement, wrongful death, and even elder abuse restraining orders.

Further, it imposes procedural hurdles that are virtually impossible for many litigants to meet, like finding a private court reporter within five days or proving a hearing cannot be delayed. These restrictions effectively shut out low income and unrepresented litigants who need the protection of a record most of all.

We urge the author and proponents to amend the bill to allow for electronic recording in all civil cases where no court employed reporter is available.

We're working in coordination with legal aid services to propose a solution and are committed to working with the author and stakeholders to improve this bill and ensure that California's access to justice is protected. Thank you for your time.

Thank you, Mr. Chairman and members. Mike Belote, speaking for the California Defense Council. Sometimes we're accused of being anti court reporters. Simply not true. In fact, I don't think I've ever met a judge or lawyer who's anti court reporter. We'd love to have all the court reporters we need in our environmental or judicial ecosystem.

To use an occurrent term. We use court reporters in two main contexts, depositions and then in court. And we're having more and more trouble getting court reporters in either context. And the prices, as Casey noted, are going up.

I think there's great wisdom in the analysis which talked about the need for people to put aside prior differences and see what we can come up with to address this situation, both short and long term. And I would suggest, for example, the analysis says the sponsors may wish to consider expanding the scope of cases that are authorized.

The bill does nothing for our cases, the unlimited civil cases that are costing us more and more to record. It says the author and sponsors may wish to consider permitting electronic recording in unlimited civil matters if all parties consent. Almost everything in the code of civil procedure can be changed by stipulation of the parties.

And we would suggest that this would be another example of that. So we'd like to continue the dialogue. It's time to put aside the differences and the history and work together so that the entire judicial ecosystem can work more efficiently both on the deposition side and the court side. Thank you.

Thank you. Is there anyone else here in opposition to AB 882?

Yes. Good morning, Mr. Chair and Committee members. And Committee members My name is Bunmi Awoniyi. I'm the presiding judge of the Sacramento Superior Court. I'm also a member of the Judicial Council. Judicial Council would respectfully oppose.

Thank you, your honor. Anyone else here? Okay, I'll bring it back to committee. Assemblymember Harabedian.

Thank you, Mr. Chair. Thank you to the author. Thank you to both sides for being here. I think that obviously the author has done a great justice to the system by teeing up this issue. I think that we have had good discussions about this bill. I do think that the bill should be broader.

I do think that the opposition brings up some very valid points about the access to justice.

I think in this day and age, we need more electronic recordings, more transcriptions, more access to records that can be used in all types of cases, that can be used at the appellate level, that can be used for all litigants that are in our courts. As a prosecutor, one of my best friends was my court reporter.

In every court, I'm sure the public defender is the same way. Court reporters are amazing. They do great work. We don't have enough of them. Most of the courts that I'm in now, in the civil world and every arbitration or deposition, it's hard to find a shorthand reporter. It's very, very hard.

And a lot of the companies now in the civil side are actually going towards remote live reporters. So you're doing depositions, you're doing hearings, and my reporter is on a zoom. And I think that speaks to the real limitations of trying to make this work with a court reporter in every instance.

I think the technology still has a ways to go. I think that we can all agree that it's not perfect, but all of us who have been on zoom now since COVID almost every day, or who are on social media to Mr.

Lowenthal's previous bill, there's live transcriptions on almost all the technology that we're using now, and it's pretty good. And there is no perfect transcription, whether it's human or whether it's technology. So I'm an eye out of this committee. I would like to see it expanded.

I think this bill really should be a gateway to having a 21st century courtroom experience and deposition experience. And I think the transcription using electronic recording is a way to get there, and it is a way to actually, hopefully build a bridge with our court reporters, because I do think that they do a fantastic job.

We should utilize them more. I think a lot of this is the economics of the court system right now, obviously, and we have a judicial officer here. The courts are not funded enough. We need more money going into the court system, more money for court reporters, judges, etc.

But while we figure out that budgetary need, the access to justice piece is very important. And I think litigants right now are not getting transcripts because we're not allowing electronic recording. And so I would love to see this bill expanded before it comes to the floor. But I'm an eye here, so thank you very much.

Thank you, assignment Member Pacheco.

Thank you. And thank you to the author for bringing this bill forward. I think it's important to have this, this discussion. Court reporters are extremely important. But like the opposition mentioned, I do have concerns. You know, judges and attorneys, we all want court reporters. We know how essential they are. Like my colleague mentioned, they are essential.

But I also have concerns that requiring that a party provide five days notice in order to obtain a court report is going to be really difficult, especially when a party doesn't know the requirements for the court system. So I think that's going to be tough.

And I think at the end of the day, everybody needs to sit down and figure things out. Like the opposition mentioned, I'm hoping one day we can get there, but for now I can't support, support the bill.

But I'm hoping, I'm hoping and I know the, the author, I know you will continue working on this, but it caused me serious concerns when I hear judges are also in opposition. So I'm hoping again that everybody can sit down, we can work together and we can figure it out. But thank you so much to the author. You are amazing.

I think I want to thank the author as well. I think I want to align myself with the court reporter. I think I told, I told the author yesterday that this was one of my least favorite bills.

Not because it's not important and because the goals of the bill are not, are not good, but because I think there's so much justification for the bill on the one side and there's some valid, some valid concerns on the other. And so I would like to see it expanded some hoping.

I know this is a, you know, this is the product of a lot of years of back and forth on this issue. And so I just want to recognize that I'm going to support the bill today to allow those conversations to continue to happen.

But you know, I look at friends from the, you know, from the consumer attorneys, but also look at, you know, Bet Tzedek, which is a, which is a nonprofit legal services organization that's in my district who has concerns about some of the impacts that this could have on provision of services for indigent legal folks.

And I heard from our friend from SEIU that I may be reading that wrong or they may be reading the bill wrong. And so I want to acknowledge that. I think it's just sort of too complicated for us to sort of figure all that out.

But I do, you know, when we're getting some of the folks like that coming in expressing concerns as well as the consumer attorneys, it tells me that I'm hoping that you all will sit down together and really try to narrow the differences. So I'll be supporting the bill today, though.

Senator Stefani thank you.

Thank you chair, really quick. Yes. I'm an I out of committee today and do have some concerns based on those that were raised here today. And I do value court reporters so much. They saved me one time in a deposition when I thought the plaintiff said he bought a keg at Safeway and he actually bought a cake.

And so it saved me some huge embarrassment to the partner I work for. So thank you to court reporters. But yes, I see these concerns as something that we really need to work on. And I'm an I out of committee today and hope we can continue to work together, together to find a solution to this problem. Thanks.

Yeah. I just have a quick point of clarity. You had stated that this doesn't prohibit the purchasing, but when I read the bill, it explicitly prohibits the purchasing of electronic recording. Can you clarify on that one?

Yes. So the bill actually strikes out the word that says. It adds a word that says they can purchase it. They cannot purchase it solely for the purpose of monitoring judicial officers, because what we saw is that electronic recording was being installed in courtrooms where there are no subordinate judicial officers presiding like felonies.

So you can still purchase it. You just can't only purchase it to monitor subordinate judicial officers. And like I said, it's already included in the remote proceeding technology.

Thank you.

Thank you. Any other questions or comments? Madam Vice Chair.

If I may, that I was confused on that provision as well, because I hope that we're wanting to get to more acceptable uses of electronics just to fill the shortage of court reporters and keep the civil process moving forward.

I too, am concerned that it is too narrow and maybe it's not seizing the opportunity to really broaden the, broaden the need for keeping our civil court system moving quickly. So I don't, I'm not comfortable with it yet. So I'm not going to go all the way. I just hope that you can't. This is.

I see it as an inflection point. Bringing this forward is really important to move into the 21st century. I think court reporters are absolutely essential. I just think the number of cases in the courts are just so overwhelming and the delays. Let's just find ways through technology that's accurate, reliable, consistent and 100% reliable.

I think that's a wonderful goal and that should be maintained. I'm just not there yet. But I would seize this as a time to really find where technology can help our judicial system and not get caught up in this type of case or that kind of.

Let's just keep experimenting and using and applying the technology to expedite the courtroom procedure so we can keep the civil system moving forward. So I think there's an opportunity to do that now. So thank you.

Thank you. And I want to thank the author for taking on this book challenge. And I appreciate both the support, witnesses and opposition for continued commitment to work on this troubling or difficult issue. The reality is that if we had the resources to hire court reporters, we would have court reporters.

And I don't think it's because simply the court system is not a jobs program, but because we know the veracity of those records are best when it's when there's a court reporter taking those records. That's why I spent 11 years as a public defender. As a public defender.

And I certainly wouldn't want to rely on the current technology for those records versus a court reporter. And so I think that for me, that's a starting point. But I also recognize we don't have all the resources to hire all the court reporters we need. And that's just another reality we're in.

And so this bill recognizes that maybe not to the extent that the opposition would like it to, but that's where the conversation will continue. I think you've heard from, from colleagues that the desire for continued work on this, and I'm confident that our colleague will continue to do that work. And would you like to close?

Yes. Thank you so much, Mr. Chair, for your summation too. I, I do appreciate, because you're kind of hitting the nail on that. We all agree that access to justice should be the goal here. I think we see it a little differently from my perspective.

I think accuracy gives you that access, but I can certainly understand the shortage. So the bill is really narrowly tailored for a three year stint and, and it allows the electronic recording. So let's emphasize what it allows in the electronic recording world. It certainly has you heard the court reporter maybe not liking even to the.

The woman that was here. To the extent that it allows electronic recording, but it does allow electronic recording in a fashion that is narrowly tailored.

By the same token, I hope that the courts use the money they've been given to enhance the hiring of court reporters because in my mind, accuracy truly is the best way that we allow access. And I hear certainly the trial attorneys because they front the cost, too.

Now, granted, those costs are split, but the practice of law is a business and I get that part of it. And I get the burdens that it can place on especially consumer attorneys who are fronting those expenses. So I do hear you on that front. We'll continue the discussion. Respectfully request and I vote.

We have a motion. Is there a second? And then we have a second from Senator Stephanie.

Motions do passes amended adding an urgency clause to appropriations.

[roll call]

I will place that bill on call. On to item five. Aguiar-Curry AB 325.

Thank you for your patience. Assembly Member. Let it begin. Whenever you're ready.

It's my pleasure. Thank you, Mr. Chair and Members. First, thank you to the chair and the committee staff for their work on this Bill. I will be accepting the committee amendments today.

I'd also like to thank my sponsors for their thorough work on this complex issue and all of our supporters from small businesses, labor, housing and tech oversight advocates. Members, it doesn't matter if price fixing happens behind closed doors or through artificial intelligence. It's wrong either way.

In recent years, Californians have faced an affordability crisis with prices going up on essential goods and services. The price of eggs, frozen potatoes, chicken, turkey, pork, housing, hotels, and more have skyrocketed. And many of us, myself included, thought it was from market forces. However, there's more to this than meets the eye.

Companies have been using illegal price fixing algorithms for years that have created market monopolies, stifled innovation, and hurt small businesses. I've heard from small businesses in my district, particularly mom and pop restaurants, that are frustrated with the cost of frozen french fries.

Yes, it turns out that there are four companies that control over 97% of the market of frozen potato products relied upon restaurants. They've all been found to use the same software to set their prices and artificially limit supply. Tools like this have been used for years.

It's time that we catch up to technology so our constituents don't get the short end of the stick. As a solution, AB325 updates California antitrust laws to address modern digital tools used for illegal price fixing. Because California shouldn't tolerate practices that exploit small businesses and working families.

AB325 also closes court created loopholes that will help prosecutors get the evidence needed to determine if companies are price fixing using modern technology. My team and I have had productive conversations with opposition and will continue to work with them to hold bad actors accountable while making sure we address the unintended consequences.

Today I have two of the bill's co sponsors. I have Lee Hepner with the American Economic Liberties Project and Terry Olle with the Economic Security Project Action to provide technical support. Thank you

Thank you.

Thank you, Chair Kalra, Members of the Committee, I'm Terry Olle, the Director of Economic Security California Action and a proud co sponsor of AB325. And I want to thank Majority Leader, Aguiar-Curry, for her leadership on this important issue.

The AB325 stands for a simple proposition, that you can't use digital tools to break the rules. It's a basic tenet of capitalism that in flourishing markets, Competitors strive to win customers over with better products or lower prices. We all benefit from this rivalry. Price fixing undermines this when would be competitors agree not to challenge each other.

When they instead collude to set prices or supply resulting in higher prices, fewer choices, stifled innovation, and that's bad for all of us. The essence of price fixing is that agreement, and that's really important. It's an agreement between competitors. Of course, these agreements have always been hard to detect since they're not made in public.

Think of a handshake deal in a smoke filled room or a sidebar at the annual Trade Association Convention. Over time though, enforcement has driven improved compliance, and people know the line between providing market data and facilitating collusion. Unfortunately, the advent of modern technology, software algorithms, digital platforms, has supercharged these anti competitive price behaviors in two ways.

First, algorithmic price fixing is exponentially harder to detect. Competitors may have no direct contact with each other when they rely on a third party software program that mediates pricing. The collusion happens in code, not conversation. Second, these tools enable collusion at unprecedented scale.

Traditional price fixing might have involved a handful of players, but algorithmic systems can facilitate coordination among countless market participants, making even diverse markets vulnerable. Although price fixing is still illegal, industries are pushing the boundaries and they're looking for wiggle room to use this new technology to accomplish what clearly would vibrate violate the law otherwise.

AB325 addresses these problems by making it clear that algorithmic collusion is just as illegal as analog collusion. And it does not affect legal conduct like pricing delegation or conducting market analysis. Thank you for your time.

Thank you.

Good morning. Good morning, Chair Kalra and members. My name is Lee Hepner, I'm an antitrust attorney and senior legal counsel at the American Economic Liberties Project. Last year I co authored a report on algorithmic price fixing. And this year, 18 states across the country are advancing legislation to address this problem.

Another dozen state attorneys general have joined litigation against price fixing algorithms, both Republican and Democrat alike. The paradox of an illegal price fixing agreement is that no one agrees to do something illegal in public.

In 1993, in a case called Cellular Plus, a California court of appeal recognized that quote, "Because of the well known wrongfulness of price fixing agreements, conspirators rarely make such agreements in the open or document their illicit agreements."

So the challenge for law enforcement and for courts is to identify the circumstances that lead to the inference of an illegal price fixing agreement. And they have done so in many ways. First, courts will infer the existence of an illegal price fixing agreement where competitors share their non public competitively sensitive information with third parties.

And that is because doing so is against the competitive self interest of any independent business. Second, courts will infer the existence of an agreement to fix prices where competitors know that their competitors were implementing pricing recommendations and understood it to be mutually beneficial to do so.

Or where a distributor held its product out as one that was capable of automating price decisions. And that is why the Bill before you would prohibit those specific types of conduct. Just last week, a new case was filed against an alleged cartel of over 40 construction rental equipment firms.

That's a majority of the nationwide market for both commercial and residential construction. That conspiracy allegedly began in 2011 almost 15 years ago. I think this is both emblematic of the market dysfunction underlying a lot of our economy and typical of the problem that this Bill seeks to apprehend.

We all benefit from healthy competition and I commend this Bill to you.

Thank you. Is there anyone else here in support of AB325?

Mr. Chair, Members, Mariko Yoshihara on behalf of Tech Equity Action, a proud co sponsor of this Bill, in support, also asked to provide support for small business majority. Thank you.

Good morning, Chair, Members. Mari Lopez with the California Nurses Association, in support.

Thank you.

Good morning, Kristin Heidelbach here on behalf of UFCW Western States Council in support.

Thank you.

Mr. Chair., Members, Rand Martin, on behalf of the AIDS Healthcare Foundation: 'Housing is a Human Right' Division, very strong support of this Bill. Thank you.

Thank you.

Good morning, Alexa Chavez, on behalf of United Domestic Workers in support.

Thank you.

Good morning, Alicia Dean with Sacramento Area Congregations Together, in support of the Bill.

Thank you.

Good morning, Nevneet Perrier, on behalf of the California School Employees Association, in support.

Thank you.

Dani Kando-Kaiser, on behalf of the California Low Income Consumer Coalition and National Consumer Law Center, in support.

Thank you. Is there anyone here in opposition to AB325?

If he can make space for...

Yes. We got two seats. Come on. We got one on either end.

Or someone can just sit--she, she won't bite. I don't think.

It depends.

Yeah, I understand.

Oh, you let him back in.

Good morning. My name is Eric Enson. I'm an antitrust attorney with the law firm of Crowell and Moring, and I'm appearing here today on behalf of the California Chamber of Commerce. To be clear, CalChamber supports the robust enforcement of California's antitrust laws, but AB 325 is problematic for several reasons, and we urge you to oppose the bill.

First, while AB 325 is aimed at deterring and detecting collusion through the use of pricing algorithms, that conduct is already unlawful. California and federal antitrust laws are statutes of general application.

They apply to all businesses and all means of business, meaning that collusion through the use of pricing algorithms is currently prohibited by federal and state law, making AB 325 unnecessary. Second, AB 325 flips traditional burdens of proof on their head.

Under current antitrust law, the government must prove that a defendant intentionally joined a price fixing conspiracy, but under AB 325, a defendant is required to prove by clear and convincing evidence that the defendant did not know that a pricing algorithm is used by someone else in a market or a similar related market. Third, the technology behind pricing algorithms is relatively new. It can have profound economic benefits.

Pricing algorithms allow businesses to optimize prices in real time, manage supply and demand, personalize offers, and adapt to market conditions, leading to increased efficiency, customer satisfaction, and many times, lower prices. AB 325 could even curtail the use of point-based loyalty rewards programs like Southwest, Rapid Rewards, or Marriott Bonvoy points.

We should allow the technology to develop and, of course, police use of the technology through existing federal and state antitrust laws. I would add that there are several other bills, I believe, that relate to algorithms that would, without expanding or changing today's law. Thank you.

Thank you.

Good morning, Mr. Chair. Chris Micheli, on behalf of the Civil Justice Association of California. CJAC shares the concerns expressed by CalChamber. First, I want to express our sincere appreciation to Madam Majority Leader and her staff for working on this measure as she always does on bills.

CJAC wanted to bring to your attention three specific provisions, all in section one of the bill. The first is an A2. In A1, it expressly says that a person can't use or distribute any pricing algorithm, etcetera. Our concern is that this is a claim statement that is declaratory of existing law.

We usually use that phraseology either to overturn a pending court decision or to somehow impact pending litigation, and so we were concerned to have that sort of language in there. If the Legislature wants to make an affirmative statement in A1, that's one thing, but to note that it's declaratory of existing law, that is of concern.

The second is in Subdivision C, which raises a bar of clear and convincing evidence, a very high standard for a defendant to meet in these types of disputes, and the third is in Subdivision D, which would result in joint and several liability.

So from a liability concern along with concerns expressed, although the author and her staff have indicated a willingness to work with us on some of the broad and--in some instances, we believe--vague terminology, having joint and several liability is also of significant concern to CJAC and its members. Thank you, Mr. Chair.

Thank you. Is there anyone else here in opposition to AB 325?

Good morning, Chair and Members. Catherine Charles, on behalf of the Chamber of Progress, in respectful opposition.

Thank you.

Good morning. Jacob Brent, on behalf of California Retailers Association, in respectful opposition.

Thank you.

Good morning. Kalyn Dean, on behalf of the California Hospital Association, in regrettable opposition.

Thank you.

Good morning. Robert Boykin, on behalf of TechNet, in respectful opposition. Thank you.

Thank you. We'll bring it back to the dais. Assembly Member Harabedian.

Thank you, Mr. Chair. Thank you to the author for bringing the bill. Thank you to the testimony from both sides. I think that--and we've been able to discuss briefly about the bill--and I do think that there's two things that I'd like to see kind of going forward, and I know you're negotiating with opposition about these two aspects, but one is the definitions.

I do think that the definitions in the bill to me need to be clarified or tightened up, and I think the main ones are pricing algorithm. I think the analysis, which was excellent, does delve into a bit of ambiguity as to how we are defining pricing algorithm and could be very expansive depending on the person reading it.

So I'd like to see that tightened up or just clarified, and then obviously non-public competitor data. As it currently stands, that definition actually includes public data, and I think that is problematic. I think that if we are talking about non-public competitor data, very, very clearly should not be used to price fix or form any sort of cartel. I think both sides would agree to that.

I think the way that we define it here though, would actually open up potential for misusing this for situations where it's not actually non-public data, right? It's someone's prices, it's been used publicly and widely distributed, and here there's this 'widely available' kind of bar to meet. And I'm not sure if that's totally clear to me.

So I would like to see that tightened up on those definitions, and then secondly, I do think the pleading standard--and this is something, sort of an inside baseball attorney point--but I know that you'll get--yes, I was going to say--I just think that the pleading standard needs to be consistent with the Cartwright Act.

Right now, a plausibility standard for pleading would hypothetically allow anyone to bring a case against potential defendants based on plausible uses of pricing algorithms, right?

So it is plausible that three companies used a pricing algorithm and you'd probably have to plead a very low bar to get past motions to dismiss, which would then cause many defendants who have not actually probably done anything wrong to have to pay out huge settlements, and it would really be, I think, a influx of cases that probably weren't fully meritorious.

So I would like to see the pleading standard just compliant and consistent with the Cartwright Act and those definitions tightened up, and I will be an aye out of, out of the committee today and I assume that we'll get these things right. So thank you for bringing the bill.

Thank you. Thank you very much, Assembly Member. I just want to recognize--thank you for the questions that you're asking there. We do have a definition crafted this way because the tools that are being used to collude are as smart as Open AI or as dumb as Excel.

So what I'm trying to prevent is anti-competitive agreements that are happening formally or informally with competitors. So your point's well taken. We'll continue to work with the opponents on the bill. Would you like to answer anything?

No, I--that's quite right.

Any other questions or comments? Assembly Member Pacheco.

I'll just make a quick comment. I want to thank the author for bringing this bill forward. I know we've had discussions and I also respect the opposition's point of view and I know that you're going to be working and have committed to working with opposition because they do bring up valid points.

And so I am an aye today and I look forward to the, the finished outcome and seeing what we have on the floor, and I want to thank the member for all your hard work and for always agreeing to work with the other side, and I appreciate you very much. Thank you.

All right. Thank you. Do we have a motion and a second? Okay. No further comment. I also want to thank our Majority Leader for bringing this measure forward. As evidenced by the conversations here today, the problem this bill seeks to solve is very real, although it is complicated.

But antitrust law promoting competition has been a hallmark of American law for over 100 years. Advances in AI and data infrastructure now allow third party pricing algorithms--sometimes trained on sensitive competitor data--to be used across multiple firms, enabling coordinated pricing without direct communication or human involvement.

The result is a technologically mediated form of price fixing that achieves the same anti-competitive effects as traditional collusion, but without overt coordination, making it difficult to detect or prosecute under current antitrust law. It's really modern tools for the same old behavior.

The author and her sponsor have invested significant time in solving that problem, in crafting a bill that aims to bring the Cartwright Act into alignment with modern market realities. There's clearly more work to do, but I'm confident that we can get there.

This is certainly a dense area of law, but the author is no stranger to taking on thorny issues, successfully authoring legislation that improves the law and improves the lives of Californians. So I fully support and believe that this bill will be no different, and I'm confident in the author in getting to a resolution on some of those issues and urge my fellow community members to support her in this measure as it will undoubtedly be refined along the process. Would you like to close?

Respectfully ask for your aye vote. Thank you very much.

Motion is do pass as amended to Privacy and Consumer Protection. [Roll Call].

We'll place that on call. Thank you, Senator Ransom. Item 15. AB 935. All right, so we have item. We have two items up for Assembly Member Ransom, first one being AB 935.

Thank you, Chair. Surprise, surprise, having you guys ready early. Thank you. All right. Good morning, Chair and Members. I'm here to talk about Assembly Bill 935, which strengthens the clarity and precision of existing civil rights protections, especially in how state collects demographic data. These changes matter.

They ensure that Californians, particularly black students and families, have a clear understanding of their rights and when those rights are being violated, especially in educational settings. As Members of this Committee, you understand how critical it is for our laws to be clear, thoughtful and actionable for government agencies. The California Reparations Task Force underscores this point very clearly.

When laws lack clarity and when data is incomplete, systemic discrimination remains hidden in plain sight. For two years, Members of the public in public comment and other communications with the task force repeatedly raised concerns.

The concerns included issues with responsiveness and transparency related to the treatment and disposition of complaints, particularly those filed by African Americans raising civil rights concerns. In response, the task force provided the recommendations that this Bill is asking you to implement. The Bill is just another tool in our government toolkit to increase transparency in government.

The clarification provides access to solid evidence based information. The fault the foundation of good policymaking for the Legislature as well as the public and agencies themselves. This Bill is not creating anything major and new. The Department of Justice already uses the same systems that we're asking to implement in other agencies. Department of Education.

We'd like to see that mirrored in order to provide clarity, justice and the ability to move our state forward in all settings, not just at the Department of Justice, but also in educational settings and other settings. And I respectfully ask for your ivlope and I'm here happy to answer any questions.

Thank you. Is there anyone else here in support of AB935? Is there anyone here in opposition to AB 935? We'll bring it back to the Committee. Any questions? Motions and I'll second that. Would you like to close?

Yes, sure. Thank you. So thank you for the opportunity to present this Bill. As mentioned, there was a two year a study to look at opportunities to ensure that justice is accessible to everyone. This is not creating a new system.

It's simply ensuring that the same systems that we see work in the Department of Justice are implemented in other public settings, especially in the Department of Education. It's important that people understand what their rights are if they want to be able to access them. And so this Bill would be a step in that direction.

And we appreciate, you know, your assistance in getting that done. And I respectfully ask for your aye vote. Thank you.

Thank you.

[Roll Call]

All right, we'll place that Bill on call and you can go ahead to your next one. AB 1414.

All right, here I am again. All right, thank you chair and Members. Again, I'm here now to talk about Assembly Bill 1414, which is the ability to access, to access reliable Internet, as we know and definitely learned during the pandemic, access to reliable and affordable Internet services essential for work, education, health care and daily life.

That freedom should be allowed and afforded to tenants 10 tenant should have the freedom to choose an ISP which is an Internet service provider that aligns with their requirements Their budget. Assembly Bill 1414 assures that renters across California are not compelled by landlords to subscribe to a specific Internet service provider.

This safeguards their autonomy to select services that best meet their needs. As we know, sometimes folks are able to, based on their income, qualify for high quality services at a more affordable. At the federal level, the FCC has established rules to promote competition and consumer choice in multi tenant environments.

While the FCC prohibits service providers from entering into exclusive access agreements with landlord it does landlords it does not prevent landlords from restricting tenants choices by limiting access to certain providers. San Francisco addressed this issue through their own ordinance requiring landlords of multi unit buildings to grant reasonable access to any license or authorized Internet service provider.

And Now Assembly Bill 1414 seeks to extend similar protection statewide, ensuring that all California tenants, regardless of their city or county, have the right to choose their preferred Internet service provider without landlord interference. This Bill also provides a clear remedy. Remedy.

If a landlord violates the provision, tenants can deduct the cost of the imposed subscription from their rent. Offering a practical enforcement mechanism, AB 1414 represents a balanced approach to enhancing tenants rights and fostering a competitive market for Internet services. And with that I would respectfully ask for your aye vote.

Thank you. Is there anyone else here in support of AB 1414?

Good morning. Karen Stout on behalf of Power California Action, thank you.

Is there anyone here in opposition to AB 1414? No one dares oppose some of our ransom bills. Do we have a motion? And we have a second from our Vice Chair. Would you like to close?

Not much more to say. I just really appreciate the opportunity to ensure that tenants have access to reliable Internet services of their choice. And thank you. Respectfully ask for your aye vote.

[Roll Call]

All right, we'll place that on call. Thank you.

Thank you sir.

Up next is item 3, AB67 Bauer Kahan. Being presented by principal co author Senator Perez. Whenever you're ready.

It's nice to see you all and. Visit you in the other house. Good morning Chair and Members. First of all, I want to thank Committee staff for the work and collaboration on this Bill. I am proud to be a principal co Author and present AB67 on behalf of Assemblymember Bauer Cahan.

This Bill will protect the reproductive rights of Californians by allowing the Attorney General to enforce the Reproductive Privacy Act. The Reproductive Privacy act, established in 2002 is a crucial law which prohibits the state from denying or interfering with a person's fundamental right to an abortion. This law includes all local governments, whether counties, cities, cities, towns or corporations.

In California, we have witnessed multiple cases of local governments attempting to make it more difficult for reproductive health clinics to operate. Specifically, cities such as the cities of Beverly Hills and Fontana have interfered with abortion clinics ability to remain open within its city limits. These violations should not go unanswered.

Current law allows only affected individuals to file suit, which is deeply unfair. These individuals often lack the resources, time or legal expertise to challenge such violations in court. AB67 strengthens the attorney General's ability to uphold the existing law. It does not create new regulations. It simply ensures that the state can hold violators accountable.

Our state has long led the nation in protecting reproductive freedom and and this Bill reinforces that leadership by ensuring our laws are fully enforceable. With me to testify in support from Attorney General Bonta's office is Tiffany Brokaw, Deputy Attorney General and Erica Connolly, Deputy Attorney General to answer any technical questions.

Thank you.

Good morning Chair and Members Tiffany Brokaw, Deputy Attorney General with the California Department of Justice here on behalf of Attorney General Rob Bonta, who is the proud sponsor of AB67 and he'd like to thank Assemblymember Bauer Cahan for authoring this important piece of legislation and Senator Perez for being the principal co author and presenting today.

AB67 would authorize the Attorney General to enforce and assess monetary penalties for violation of the Reproductive Privacy act, which I'll call the RPA. The RPA was enacted in 2002 prohibiting local government entities from interfering with a person's right to have an abortion in California.

In 2022, the Legislature amended the RPA to allow for a private right of action. Although this was an important change, the private right of action may prove to be ineffective because the onus to bring a lawsuit is on the individual seeking to access an abortion.

Individual plaintiffs typically have limited resources to bring litigation for a violation and there haven't been any cases brought under this enforcement mechanism to date. AB67 addresses an issue that has occurred in multiple locations across California.

Local government entities interfering with the reproductive rights of Californians by using their power to block or obstruct abortion providers from opening in their regions. The most recent example was the City of Beverly Hills interference with an abortion provider's ability to to open within its borders.

There needs to be stronger penalties in place to deter localities from such actions before they occur. A monetary penalty for violating the RPA sends a message that there are serious consequences for interfering with a person's fundamental right to an abortion in California. AB67 is an important step in ensuring California remains a safe haven for abortion access.

Our office agrees with the Committee's suggestions related to the compelled testimony in the Government Claims Act. We think that they make sense. We just need to discuss it in detail with the author when she's back. I have here with me Deputy Attorney General Erica Connolly to answer questions and we ask for an aye vote.

Thank you so much. Is there anyone else here in support of AB67?

Good morning. Chair and Members of the Committee Sosin Madden, FW Strategies here on behalf of. The California Nurse Midwives Association and strong support.

Thank you.

Good morning. Mari Lopez with the California Nurses Association that's struggling with that one this morning in support. Thank you.

Good morning. Symphoni Barbee on behalf of Planned Parenthood Affiliates of California in support.

Thank you.

Good morning. Keshav Kumar with Lighthouse Public affairs on. Behalf of Reproductive Freedom for All in support.

Thank you.

Good morning. Katherine Squire on behalf of the California Commission on the Status of Women and Girls, in support.

Thank you.

Good morning. Savannah Jorgensen with the League of Women Voters of California in support.

Thank you. Dani Kando Kaiser on behalf of the Oakland Privacy in support.

Thank you. Is there anyone here in opposition to AB67.

Chair and Members, I am Sophia Lorey, the outreach Director at California Family Council and we stand in opposition to AB67, a Bill that clearly reveals the California Legislature's extreme pro abortion agenda.

AB67 would weaponize the Attorney General's Office against cities and counties that seek to uphold the values and concerns of their local communities by refusing to host abortion centers that offer late term abortions. So let me be clear. AB67 is not about protecting access to health care.

It's about punishing local governments who dare to voice dissent or express concern over clinics like the Dupont Clinic, a facility that performs third trimester abortions. Dupont never opened in Beverly Hills because the city decided it did not want to be known as a destination for late term abortions.

That was a local decision made in response to community concern. Yet Assemblywoman Bauer Khan now wants to make it easier for the Attorney General to silence that kind of local self governance and moral conviction. A 2021 AP Narc poll found that 80% of Americans oppose third trimester abortion.

Yet this Bill enables the state to steamroll any community that dares to reflect that mainstream view. AB67 grants the Attorney General sweeping new powers, public and private investigations, subpoenas and civil penalties up to $25,000, all to enforce an agenda that most Americans disagree with.

Placing no limits on abortion, even in the final months of pregnancy, when babies can survive outside the womb. So here's the grim reality of what AB67 defends. Third trimester abortions that often involve injecting a substance into a baby's heart to cause cardiac arrest, then inducing labor so the baby is delivered stillborn.

These are viable babies, often more than 25 weeks long, capable of life outside of the womb. That's not health care. That's homicide. And this Bill would let the state sue any city that refuses to host this brutality. AB67 sends a clear message. If you are a city or county that objects to hosting late term abortion centers, the state will come after you. Vote no on AB67.

Thank you.

My name is Chloe Cole and I am a detransitioner from the Central Valley of California. I used to believe growing up that I was a boy and every medical provider I had affirmed me in this lie. But even worse, they convinced my mom and dad that if I did not undergo cross sex interventions, I would kill myself.

That fear for their daughter's life led my parents to put me on puberty blockers which caused me to experience menopause at age 13. At the same age I was put on testosterone and at 15, my breasts were surgically removed. All of these treatments have made me sick and altered my body for life.

This Bill is going to permit the AG to sue any governmental entity that interferes with the Reproductive Privacy act, which includes so called gender affirmative care.

If it passes, the ag, one of those, one of the most pernicious supporters of chopping up children like me will have a cudgel that he can wield to block any city, town or county from preventing another lucrative sterilization factory from setting up shop.

After the Trump Administration issued the Executive order to protect children from chemical and surgical mutilation, Rob Bonta issued the statement. Hospitals and clinics have a legal obligation to provide equal access to health care services.

But what he really meant was that California must provide barbaric medical treatments on children that will result in sexual dysfunction and sterility or be sued. This Bill is going to ensure that California will continue to be the most grievously unsafe state in the US for children and vulnerable adults.

When will our Democrats wake up and realize that no child is born the wrong body but they are beautiful the way that they are and deserve to grow up healthy. Thank you for your time.

Thank you. Is there anyone else here in opposition to AB67? Okay, we'll bring it. oh, yeah.

Karina Garcia, Sacramento resident, the Bride's Chamber. I'm in opposition of this Bill. Thank you.

Thank you. Right, we'll bring it back to the Members. Have a motion and a motion and a second. Any other comment? I want to thank our Assembly colleague Barrackahan as well as Senator Perez for bringing this Bill forward and the Attorney General as well.

In partnering with that, the voters made access to reproductive health and rights, including abortion, a constitutional right in our state. And this simply allows the Attorney General to help in defending that right. Would you like to close?

Yeah, absolutely. Consistent statewide enforcement mechanism is necessary to hold violators accountable and deter future bad actors who attempt to block access to reproductive health care. And I also just want to highlight, too, I think, the concerns raised. You know, I've worked on initiatives around abortion access in the past.

You know, I do just want to highlight that California only limits abortions after the point of viability if a physician determines in good faith that the fetus is able to survive on its own. And unless there's some sort of risk to the mother's life, that's the only time that something like that could happen.

And that's actually based off of state law. In addition to that, the yes in Prop 1 campaign, which I worked on, actually has protections in there as well. So I just want to make that really clear to folks because I know that there tends to be misinformation around this. I respectfully ask you all for your aye vote. Thank you.

Thank you.

[Roll Call]

All right, we'll place that Bill on call. Thank you. Next. Item 7, AB 672. Caloza.

Hi, Mr. Chair.

Hello. Whenever you're ready.

I have a witness testimony. I think they're just waiting to get in. If I can just. I'll begin. But Sandra from SEIU may be stepping in.

Yeah, go ahead.

Great. Thank you, Chair Kalra and colleagues. I'm here to present AB672, which is about protecting our public employees and their right to collectively bargain.

AB672 will require public employers to notify the Public Employment Relations Board if they file a court action involving the statutes per administers. It would also give PERB the right to protect public employees and intervene as a party to help maintain consistent application and enforcement of labor protections and policies. Across the country, especially at the federal level,

public employees are vulnerable and need more protections in the workplace. Many of our public employees are union members, predominantly women of color, immigrants, and working class people. These are the jobs that help forge the middle class. Child care providers who care for young children, teachers who educate the next generation of leaders,

park employees who help keep public parks available to all, and all public employees who are the backbone of our state, deserve more protections in the workplace. I believe that California can show the nation that public employees are public servants and that this is an honored profession.

It's imperative that we treat public servants fairly in order to produce a more responsive, more representative government where we are all valued. But we can't just accomplish this with words of thanks and recognition alone. It's important that the structures, policies, and practices of our state ensure fairness for all.

AB672 would safeguard California's workers and their rights by promoting fair and consistent application of the laws intended to protect all public employees. Here with me today and also sponsor of this Bill is Sandra Barreiro from SEIU California.

Thank you.

Thank you Mr. Chair and Members, Sandra Barreiro on behalf of SEIU California, I want to thank Assembly Member Caloza for authoring this important Bill and for her comments and I just make myself available to answer any questions.

I respectfully ask for your aye vote.

Thank you. Is there anyone else here in support of AB672?

Good morning Chair, Members, Janice O'Malley with AFSCME California. We're proud co sponsors of the Bill. Thank you.

Thank you.

Good morning, Nevneet Perrier on behalf of the California School Employees Association, in support.

Thank you.

Thank you, Mr. Chair, Members, Megan Subers on behalf of the California Professional Firefighters, in support.

Thank you.

Good morning, Elmer Lazardi on behalf of the California Federation of Labor Unions, in support. Thank you.

Thank you. Is there anyone here in opposition to AB672? All right, bring it back to Committee. We have a motion and a second. Any further comment? Thank you, Senator Caloza, for bringing this Bill forward and SEIU for the sponsorship. Would you like to close?

Thank you so much, Chair Kalra, and to the members of this Committee, I respectfully ask for your aye vote. And thank you as well to all the supporters and the co sponsors of this Bill.

Thank you.

[ROLL CALL]

I think it's aye.

We can wait a minute and have you check your notes.

Yeah, just let me look at what it is real fast.

This is item seven, AB672.

It's aye.

[ROLL CALL]

All right, we'll place that Bill on call. Thank you. Item nine, AB750. Quirk-Silva. Whenever you're ready.

Good morning, Mr. Chair and members. First, I want to thank the committee consultant for working with my office. We have taken the author's amendments and are working with Housing California on their amendment. Today I present AB 750, which enhances the implementation of AB 362 by improving accountability, transparency, and enforcement of health and safety standards across California's 13,000 homeless shelters.

Prior to AB 362, California had no standardized health and safety regulations for homeless shelters, leading to widespread reports of unsafe and unsanitary conditions. A 2019 ACLU--a 2019 ACL of Southern California report entitled "This Place Is Slowly Killing Me," detailed instances of overcrowding, neglect, abuse, and dangerously unsanitary environments in shelters.

In response, I authored AB 362 to mandate that cities and counties investigate shelter violations and report substandard conditions to the California Department of Housing and Community Development. However, local compliance has been alarmingly low.

A recent CalMatters investigation found that only five of California's 58 counties and just four of the state's 478 cities have submitted reports as required by law. Serious violations, including rodent infestations, lack of hot water, and hazardous conditions have been documented, yet critical incidents such as deaths, assaults, and sexual abuse are often left unreported.

Gaps in residents' awareness, inconsistent reporting by local governments, and the lack of standardized reporting formats have undermined the effectiveness of the law. This has left shelters operating without standards and with little accountability, leading to widespread reports of unsanitary and unsafe conditions. We have to do better.

AB 750 straightens state oversight and enforcement by empowering shelter residents: requiring shelters to post signage about residents' rights and reporting procedures and to provide this information at intake, standardized reporting: establishing clear reporting requirements and deadlines as well as mandating reports even when no complaints are filed, and strengthening accountability: implementing penalties for non-compliance, including withholding state funding from jurisdictions that fail to report. With me today to provide testimony in support and to answer questions is Karina Garcia, a member of the Sacramento homeless community.

Thank you.

Thank you, Chair and committee members. My name is Karina Garcia, Sacramento resident and homeless advocate with lived experience. I worked in the shelter last year. I also counseled people over the past five years in regards to conditions at AB 705 seeks to change. While I was working in a shelter, I observed unsanitary living conditions.

There was a lack of PPE for staff and clients to use to clean up feces, vomit, and other human bodily fluids. There was no proper training or manual on disease prevention and control. You could not properly clean anything due to the lack of resources available, nor were staff and clients educated on proper procedures.

Mold was always an issue due to improper ventilation. I requested cleaning tools and chemicals to be ordered by management and it was declined. Food was left out all day for clients to retrieve. It was not properly stored. There was no food handler permit required even though staff had to serve cooked food.

When people had Covid or another disease, staff would isolate them in the dining room where they also stored the food. The conditions that staff and clients were forced to endure were inhumane. Some of the shelter locations are not safe. One in particular is on Roseville Road.

The traffic is very heavy and you cannot see clients or staff walking. This has already caused someone to lose their life because of a lack of safety requirements or enforcement our state does not have in place to protect the homeless.

AB 750 guarantees rights for shelter residents, a transparent complaint process, and an annual inspection to enforce safety and health standards. Shelters receiving public funding must be held to basic standards. We need to honor people. We should not have higher standards for prisons than our shelters.

I worked in the prison system during Covid and we took better care of our prisoners than these most vulnerable people that we place in shelters. Shelter means like a refuge where you go seek and that is not what we have right now. This bill will ensure taxpayer dollars are not subsidizing harm, but supporting true rehabilitation and protection for the homeless. Pass AB 750.

Thank you so much. Is there anyone else here in support of AB 750?

Hello. Ethan Lares-Salinas, on behalf of ACLU California Action, in support.

Thank you. Is there anyone here in opposition to AB 750? All right, we'll bring it back to the members. Any questions, comments, motions? Assembly Member Bryan.

I just want to thank the author for bringing this bill forward and for the witness's powerful testimony and definitely don't want to speak for her, but I know that we're not trying to contrast people in different situations. Whether you're in prison, in a shelter, or anywhere, you should have basic, kind of safety and standards and hygiene and humanity, and that's what's missing, and that's what this fight is about, so thank you to the witness and to the author for coming forward, and motion to move the bill and happy to join as a co-author if you'll have me.

Second.

All right, we have a motion and a second. Any other comment? Assembly Member Zbur.

So I just want to thank the Assembly Member who has really been one of the leaders in the Assembly really looking out for the in-house population and our California communities, and I would love to be added as a co-author as well. Thank you so much for bringing this forward.

Yes, Madam Vice Chair?

Well I commend you for bringing this forward. I think the humane conditions or subhumane conditions are not acceptable or tolerable. I am concerned with one provision that would allow the civil action, so some--perhaps a homeless person could become, with the help of an outside attorney--just there's be a needless series of lawsuits just for the point of civil action when I think your prior bill, the prior law, existing law to mandate a report, but getting into civil action punishment is concerning to me.

It's concerning. We really are trying to focus on the enforcement part as far as the reporting. As was noted in the bill, there was such little compliance with AB 362, and I think that's a warning to all of us, particularly related to our legislation just across the board.

Many times we put bills forward, we get them passed, and then because we are not out there ourselves individually monitoring and checking on them, often they're not enforced, so this actual CalMatters report really did the investigation for us, but the real focus--but I hear you on the maybe civil actions that could result in going through the system--but really this is about reporting and making sure that we are strengthening what the shelters are already expected to do.

Well--and I commend you and you're absolutely right, if those conditions exist. I just anticipate that it's a classic case for lawyers to get a class together and we'll never see the end of it, and the local governments mandate--unfunded mandate on local governments will be--and granted, they should be doing their job to make sure those facilities are maintained appropriately. I just have a concern with that. So I just want to--

I understand. I definitely hear you.

Thank you, Assemblywoman.

Thank you, and I also want to second the, the comments in regards to your work in this space during your years in the Legislature. I wholeheartedly support this legislation. Would also like to be added as a co-author. Would you like to close?

Just that, sadly, one of the things we know in California is shelters; we really are in a new space with this, many shelters being in California less than a decade, and we know that the initial expectation is people would move into a shelter and be there for a very short amount of time, maybe three to six months.

We've actually seen those stays be quite a bit longer, sometimes one, two, or three years, and this bill is simply saying the basic conditions should exist and those that are host to these shelters across California need to be making sure that these basic conditions are in fact happening. And with that, I respectfully ask for an aye vote.

Thank you.

Motion's do pass as amended to Appropriations. [Roll Call].

Place that Bill on call and he's one more vote. Thank you. Let's actually, I gotta head down to a couple bills. I was gonna see if we can do the consent calendar while we're here. Is there an item? Yeah, we can do that as well. Let's just do the consent right now, if we could. There's item. I believe the one item, AB541 DeMaio will be pulled from consent. The remaining items. If we can have our secretary name list the remaining items, please.

[Consent Calendar]

Yes. Is there a motion on those bills? And a second. Okay.

[Roll Call]

Okay, consent calendar is out and we'll call up Assembly Member Ortega. And I'm going to pass the gavel onto our Vice Chair as Assembly Ortega makes your way up here to do first. AB866 file item 11.

Did you have any witnesses?

I do. I believe I have Ellie Bloom from the Attorney General's Office.

Oh, a lot of people out there. Okay. Good morning. This is Assembly Bill 866. Assemblymember Ortega, please proceed.

Thank you, Madam Chair. Members, for the opportunity to present AB 866 today. AB 866 would ensure that California and federal student loan borrowers enjoy the same consumer protections as those who have private loans or who hold loans serviced by for profit and nonprofit organizations.

One in 10 California residents hold student loans which represent nearly 4 million borrowers who owe $148 billion in federal student loan debt. Student loan debt is an equity issue. The negative effects of ballooning student debt loan disappropriately falls on borrowers who with low income backgrounds or from marginalized communities.

Research has shown that the fallout of the student debt crisis is disappropriately carried by income first generation black and Latino Latino borrowers. The default rate in California, including those that are 90 days delinquent, is 7.1%. These loan delinquencies can have severe consequences for the borrower including wage tax, wage garnishment, tax or Social Security garnishment.

The California Department of Financial Protection and Innovation manages the student student loan complaint portal that tracks borrows complaints. 41% of these complaints centered around the servicer's actions, handling of the loan or the quality of the service provided by the borrower. AB 866 makes clear that victimized student loan borrowers are protected under California laws relating to consumer protections.

The Attorney General should be able to enforce those laws against all servicers and help victims of fraudulent practices get the recourse they deserve. Testify. Testifying in support with me today is Lisa Nakashima, Deputy Attorney General for the California Department of Justice, and Ellie Bloom.