Senate Standing Committee on Governmental Organization

Committee will convene in 60 seconds. Good morning and welcome. The Senate Committee on Governmental Organization will come to order. In the absence of a quorum, the Committee will proceed as a sub. We. We have an author present. File item number five, Senator Durazo for SB 629. Senator, welcome.

Good morning. Thank you, Mr. Chair and members.

SB 629 is one of 13 bills in the quote, unquote Golden State Commitment, which is a package of senate bills designed to strengthen California's wildfire response efforts, streamline fire recovery, rebuilding and prevention efforts to help stabilize our state's insurance market following the devastating Los Angeles firestorm.

And as California continues to face a year round fire season, it is clear that we must harden California's defenses against future disasters.

To help to do that, this bill will require cities and counties to designate areas that burned in a wildfire within a very high fire burned in a wildfire within a very high fire hazard severity zone, triggering the woodland urban Interface or as WUI, the building code and defensible space maintenance requirements as well as other fire safety regulations.

It will also require local governments to plan for wildfire hazards in these areas. These requirements will help not only these homes but also neighboring homes survive future wildfires. It cuts red tape, bypassing a lengthy regulatory process and it clarifies what standards apply when rebuilding if an area burned in wildfire.

Buildings have to meet the safety standards for an area at high risk of burning in a wildfire and it's a good investment. Several recent studies have found that these WUI building codes are comparable to the cost of building to the regular and residential building code.

Additionally, SB 629 mandates that defensible space based inspections occur annually for each property in the state responsibility area or very high fire hazard severity zone to ensure that property owners are taking action to protect their community.

Finally, the bill directs the state Fire marshal to include modeling for urban conflagrations in the next update of the maps so that these maps reflect the real world behavior of wildfires when they hit urban areas.

In conjunction, these measures altogether will ensure that California continues to lead on the safety of its residents in the face of a changing climate. Thank you. And I urge an I vote.

All right. Thank you. Senator. Is there any witnesses willing to testify the committee in support of the bill and seeing no one. Any individuals, anyone wishing to testify in opposition to the bill or individuals wishing to testify in opposition to the bill? Seeing no one. Bring it to the committee. Senator, Jones,.

Just a quick question. I noticed that in the analysis there is no organizations or folks in support or opposition. So I was just wondering where the, where this idea came from and what's the background on it, if you don't mind.

No, it was obviously lots of us were having these conversations, especially in Los Angeles as a result of the wildfires. And it came up as one of many important things that we had to do because of the homes not getting designated in these high risk. And it was important for the future, for their planning.

So it came out of conversations more than a particular organization.

So you haven't heard from League of Cities or any planning organizations or City Managers Association or anybody? No. Okay.

All right. Thank you.

Thank you.

Any other questions or comments from members? All right, thank you. Senator, we'll place the bill on call.

Thank you. Thank you, Members.

All right. We don't have any other authors. Do you want to go? Yeah, let me do that. We have Senator Valladares here. Senator Jones, want to take the gavel briefly while I present? I do so with great reluctance and love. So.

So we're going to take up the Chairman's bill. Okay. So in Senate Government Organization Committee hearing this morning. Right now we're going to take up Senate Bill 4- 420 by Senator Padilla.

And if there's any other members or staff that are watching the committee, we'd like to get members down here as soon as possible so we can get a quorum. We're close but have a ways to go. So we are meeting as a subcommittee now. Mr. Chairman, as you announced earlier.

And we're ready to hear your comments on SB420.

Thank you, Mr. Chairman and Members, I'm pleased to present SB420. As you know, our state has a proud heritage as a home for technological vision and innovation while maintaining ethical state standards for the development of most technologies. And- And AI cannot be an exception. Federal mismanagement has left the public vulnerable to the dangers that AI opposes.

California must step in to provide common sense consumer protections while still fostering and supporting innovation. We do not and should not have to choose between innovation and consumer protections. We can do both by focusing on technology that has potential to impact California's high risk automated decision making systems.

California can put forth a common sense regulation while protecting California values at the same time. By developing a regulatory framework in the private sector and tying this to California's procurement process, we can ensure companies comply with the regulations set forth and protect Californians who are seeking access to the benefits provided by their government.

SB420 seeks to regulate the development and deployment, both public and private sectors of high risk ADS by requiring an impact assessment to evaluate their purpose, use of data, potential for bias in particular, and the steps taken to address those risks.

The bill requires that individuals that are subject to ADS know when the tool is being used to make decisions about them, details about the ADS and where technically feasible, the opportunity to appeal such decisions for review by a natural live person. With that, I respectfully ask for an aye vote.

Thank you. Senator Padilla. Are there any witnesses, primary witnesses in support? We'll take those witnesses now, if there are any. Any additional members witnesses in support of SB420? Yes, sir.

Mr. Chairman, Members Dennis Sloke for the California Hospital Association. It's kind of a wobbler for us. We've had conversations with the author's office, but we're worried about the- the broad definition of ADS.

We believe that if it takes some of the tools that we use for analytics away from us when they're not unintentionally, and we're continuing to have those conversations but do have concerns. Thank you.

Great. Thank you. Any other witnesses in support? Alright. Any primary witnesses in opposition? Seeing nobody coming forward at the table. Any secondary witnesses in opposition to Senate Bill 420.

Chair and Members, Naomi Padron on behalf of the Computer and Communications Industry Association. We do have a respectful position of opposition, but hope to continue to work with the author as the b6ill moves forward. Thank you.

Juanita Martinez on behalf of Cal Broadband. In opposition and looking forward to continuing to work with the assem- the Senator.

Thank you. Any other witnesses in opposition? Before I bring the conversation to the dais, I'll just announce one more time to folks that are watching the committee. In addition to members showing up for committee, we also need presenters, authors to come down and present.

If you're at the high number of the file number, now would be a good time to take cuts and get down here and present your bills so you can be done for the day. With that, we'll bring conversation to the dais on SB420. Any conversation from the members on the dais?

Seeing no conversation from the members on the dais. Yes, ma'am. Senator Ochoa Bogh. Yeah, you get to open.

That's great. Sorry about that. So I'm- I'm curious. Interestingly enough, the federal government is actually working quite a bit on AI technology and regulations. And one of the con- concerns that I heard from the industry is that when it comes to innovation within the space of AI, it really- we're competing against many, many countries around the world.

And so what we do at a regulatory level is going to be very impactful on our ability to be able to be successful and be innovative. As you had mentioned earlier, the recommendation that was given during our- the committee was that or not the consideration.

It was given as a suggestion that if we have 50 states coming in and heavily regulating or coming in different perspectives and regulating the AI industry space, it's going to be very difficult for these companies to actually be able to produce a product that will meet 50 different types of regulations.

And when it comes to this particular scope of AI that it would probably behoove the US to actually do it at a federal level so there's uniformity across the states and within the industry so that we can best compete with the rest of the world.

With that in mind, I wanted to address one of the concerns that was in the letter of opposition in which the letter that was sent to the committee on behalf of the Cal Chamber, California Apartment Association, Techna Cal broad- Cal Broadband, Computer and Communication Industry and Associations.

They state in their letter that they believe that the algorithmic discrimination or discrimination that results from AI enabled technology is already prohibited under the anti discrimination laws because our laws are rights based and not technology specific. The algorithmic discrimination, in other words, is already discrimination.

I would love to give you an opportunity to share your thoughts on that particular insight that they give us as an opposition.

Mr. Chairman, Senator, thank you for the question.

I would argue that algorithmic discrimination in quotes as promulgated by the technology deployed by AI is very distinct and is new and is distinct because of its very nature and lack of the intervention or case by case involvement of a human being with individual sort of ethical sense or ability to have input. That's what makes it distinct.

It is technologically specific and therefore the threat is technologically specific and should be addressed to the technology.

Okay.

All righty.

Thank you.

Thank you.

Any other comments from senators on the dais? No other comments from senators on the dais. Senator Padilla, you may close.

Respectfully ask for an aye vote.

Thank you Senator Padilla. We are one member short of a quorum. If we can get one more member down here, that would be great. And I don't see any senators waiting to present, so maybe we'll move to Senator Richardson. Yeah, okay. And I'll give the gavel back if the Chairman would like it back.

I think that's as much responsibility as I'm supposed to handle today.

Good morning. Senator Richardson, please proceed.

Thank you. Mr. Chair and members of this committee, I'd like to first start off by thanking the chair and the committee staff for their expertise and assistance, and I am prepared to accept those recommendations and committee amendments at this time. First, as we delve into SB 656, which is small business contracts, let's start off with a few facts.

California small businesses are the drivers of economic growth and mobility, creating two thirds of the net new jobs in the state, employing nearly half of all the private sector employees, building communities, income innovation to solve global problems, and launching future growth industries.

California leads the nation in the number of patents, quantity of research institutions, investments, deployments, more venture and equity capital, excuse me, than any other state. So if California's small businesses have a significant improvement and footprint in California's economy, what's the problem? California is home to 4.1 million small businesses, representing 99.8% all the businesses in the state.

These small businesses generate $1.3 trillion in revenue, creating 7.2 million jobs. Unfortunately, and this is the point and the need for SB 656, unfortunately. However, in California, 18.5% of those businesses, that's 1 in 5, fail within the first year. And further alarming, 46.2%, that's almost 50% fail within the first five years.

So the question becomes, what can be done to foster success and sustainability? Current law attempts to address access and participation opportunities through the use of small business liaisons. A small business liaison is a person responsible for the duties relating to the interactions between their respective state, state agency and small business.

However, current law requires only large state agencies and departments, such as Caltrans, Department of General Services, to regulate and participate in this small business liaison program. There are over 116 state agencies. Yeah, I just counted them in the last hour.

And so when you look at all of those agencies, imagine if each and every one of them had an opportunity to increase contracting opportunities with small businesses. Let me point out a few to you that would simply make sense to all of us.

Imagine the California State Athletic Commission, how they could utilize coaches, different people in the work that they do, local people who have those skills. Then we look at the California Department of Aging. Imagine all of the people who provide in home health care. We look at places like also the California State Auditor.

Imagine how many auditors, people we have, who have small business experience in providing those services. What SB 656 will do is work with and require the various state agencies, all of them, not just the larger ones, but all of them, to participate in the program by having a liaison who can provide that information to the small businesses.

Specifically, SB 656 would have the agencies, via their business liaison. They would provide the information to the small business advocate. That small business advocate then in turn would post the following information on the website.

Senator Richton, I apologize if you'll suspend just one moment so we can establish a quorum.

Sure.

Padilla.

[roll call]

Present.

[roll call]

We have a quorum. Thank you for that, Senator. Please proceed. Thank you.

No problem. As I was wrapping up here, the key things that SB 656 will do is one to make sure that there is a small business liaison in all of the various government agencies. And that's essentially an individual who would act to assist small businesses to be aware of what are the contracting opportunities within that agency.

More specifically, the information that would be posted on the Internet, which is the small business advocate. It would have a list of the current contracts between state agencies and small businesses. It would also include upcoming contracts that would be available for small businesses. The total amount of each contract would be described.

The dollar amount paid to a small business would be provided. And also very key in being a small business owner myself is knowing when that contracting date is coming up so a person can prepare, take the necessary steps to participate in that upcoming bidding opportunity.

By requiring each state agency to designate a small business liaison, we can increase participation of small businesses and micro businesses and ultimately increase the success. Because we all know when we talk to small businesses, what do they say they need capital. And what can provide capital is a long term contract.

And that's what is unique in state agencies. That contracts are typically for longer terms. And once a person performs in that capacity, the ability to have other contracts becomes much easier. With that, I respectfully ask for your I vote.

Thank you, Senator. Any principal witnesses in support of the bill? Any individuals wishing to go on the record in support of the bill, please come forward. State your name, affiliation and position on the bill.

Hi, sorry. Juanita Martinez, on behalf of the California Association of County Veteran Service Officers in support of the bill. Sorry we weren't able to get a letter in, but hopefully we'll be able to submit that letter shortly. Thank you.

Thank you. Anyone else wish to indicate support for the bill? Any principal witnesses in opposition? Seeing no one come forward, Any individuals in opposition to the bill? Seeing no one will bring it to the committee. All right, Senator Ochoa Bogh.

Thank you, Senator Richardson, for the bill. I have some questions with regards to. You know, I. This is my fifth year in the Senate. One of the things that I've observed is that we continuously expand positions in government.

We expand agencies, we expand departments, we continuously expand and we create new ones because we don't normally enforce what we already currently have. And that comes because we either not fully funding the departments or we don't have the workforce.

So those are probably the two top reasons why we continuously try to fix the issue by adding more personnel or new agencies or departments.

So the question I have for you is with regards to, in my opinion, because I come from small business and I was heavily involved with the Chamber of Commerce locally in my city, it's my understanding that agencies already have that undertake significant contracting, already have a liaison, and that small business advocates are in place to undertake the same work.

The small business advocate at Go Biz is already tasked with helping to ensure that small business is attaining the established participation goals and that is empowered to work with every state department and agency to make that happen.

In addition, a small business liaison is already in place in all the agencies that are most involved in contracting that would impact small businesses.

And so when we look at that and coming from small business and knowing that, you know, being involved in the chamber that we already currently have that in place, would it be, and I'm not sure if you folks did any investigation, but as far as coming with the idea of this particular bill, were there any discussions about what we currently have in place already that is supposed to be doing that and whether or not we're actually fully funding them and giving them the resources to actually implement what you are actually and essentially want to do?

Yes, that's a very good question. And I was looking over to my staff to come over because I wanted to make sure I state this very correctly. Obviously for the record, we were actually. This was brought forward to us by the controller, isn't that correct? It's actually a state agency.

Departments are the ones who brought this forward and are saying that actually the larger. And you're absolutely right, larger departments such as Caltrans and so on, yes, they have a very aggressive small business program.

But when you consider these 116 agencies, no, it is not my understanding that every single one of them has a small business liaison that is posting all of the contracts that are available when they're coming up. It is my understanding that is not correct throughout all of the government agencies and those.

So this bill specifically states that it would apply to all agencies. And that's the catch all. Now, most departments do have within HR or some department that handles contracting. So it's my hope that within their existing staff, a person would be available to actually take the data and post the information.

Okay, so as of right now, it's not whether or not the system is currently in place. You're saying that the system within that is supposed to be doing this particular work of reaching out to our small businesses doesn't have a designated person mandatory throughout all the 116. I believe you said agencies.

Yes. And it's my understanding that originally larger departments, it was viewed Caltrans obviously has tons of contracts. So Caltrans was directed with all of their contracts to work more with small businesses. Our point is, even these smaller agencies have viable work that can be performed by California small businesses.

And we want them to work as aggressively as these larger departments do. So do the smaller agencies have a full blown small business program to the extent of what we're suggesting? No. It is our understanding they do not. All of them do not, but the larger agencies do.

Okay. And one final question. When it comes, say the bill is implemented and they have a liaison, they move forward with reaching out to and have a liaison with small businesses in our communities or within the state, does that still secure the ability to contract and put the bid to contract out to the small businesses?

Or are we just assuming people are just going to apply and get the contracts, you know, first come, first serve? What is the scenario on that part? Is the bidding process still going to be in place in all of these state agencies within this particular path?

I should have earlier said permission to respond to the chair. I'm really practicing learning all the exact things I'm supposed to say, but yes, Senator, with permission to answer through the chair.

This in no way suggests that there's a new bidding process, that certain groups go ahead, you know of others, and all of that, all the current regulations that exist regarding state contracting continue to be in place. The issue is that small businesses are not always aware of these various contracts.

And so the role of a small business liaison is to make sure that that information is out and out in a timely fashion. What contracts, the reason why, what contracts currently are provided by a small business?

If you're a small business person and you see a contract for cement for whatever department, you may think, oh great, you know, I can procure cement, I can do that. Well, it may be significantly larger than what a small business could provide.

So by the liaison providing information, this is a contract that typically has been provided in the past by a small business, then that helps that small business person go, okay, well I could go for this one, I can go for that one.

So it's providing information which is to increase access and participation, but ultimately they still have to participate in the bidding process.

And we don't have that currently in place. Just making sure.

Not in all small agencies.

Thank you. Very helpful.

All right, Any other questions or comments from committee members? Senator Valadez. I'm sorry. Senator Jones. Thank you.

Senator Padilla. For the chair. real quick, the motion will be to send this. Is it double referred or does it go to appropriations from here?

The motion is do pass to BMP.

To BMP. Okay. And then I understand there's some major amendments that not significantly rewrote it, but has somewhat added some new or changed it.

We have. We are in receipt and acceptance of this committee's amendments. There's one issue that's outstanding that I'd like to bring forward. Good morning. And discuss, and that is, for example, veterans do receive an added percentage. There's been discussion of whether that program has been run as well as it should.

According to our research, there's a six year old report that has been used and subsequent reports have been provided. And so we want to make sure that those are included in the record. And if there's room to further assist our veterans, of course we would want to do so. So we'll bring that forward in BMP.

Okay, great. And I did want to confirm, you know, for the folks on the dais, the controller's office has reached out. I don't know if she's reached out to everybody's office. We've had some pretty lengthy conversations with her and her office. I assume you're with the controller. Okay, you're. I'm probably going to abstain today, but.

But after today, let me take a look at what the BMP, you know, what's going to happen in BMP and then hopefully earn get my support on it before it goes to approves.

I look forward to that. Thank you, sir.

All right, sir, you can introduce your principal witness.

Yes, I have a witness here with the Controller's office.

Thank you. Welcome. State your name for the record. You have four minutes.

With the State Controller's office. There we go. Good morning. Chair Padilla, Vice Chair Valladeres and members of the committee. I'm Evan Johnson. I'm an Acting Deputy Comptroller for Legislative Affairs at the Controller's Office for Control Malia M. Cohen. I'm here to and thank you for the opportunity to speak on this issue. Sorry I was a little late.

The lines to get into committee are atrocious at this point, so is the best word I can think of for it. But I want to thank Senator Richardson for authoring Senate Bill 656.

Controller Cohen is proud to sponsor this bill, which builds upon the important work the legislation the Governor did back in 2022 with AB 2019, which set out to codify Governor Schwarzenegger, Governor Schwarzenegger's Executive order establishing a 25% small business contracting goal for state agencies.

Specifically, in September 2022, Governor signed Assembly Bill 2019, requiring all state agencies, departments and boards and commissions to meet a minimum goal of 25% for small businesses and 3% for disabled veteran business enterprises in the state contracting process.

The key provisions of AB 2019 took effect in January 1, 2024 and the controller almost immediately took action to align with the objectives of this legislation, instituting a 25% business participation goal for all procurements made by or on behalf of the controller's office.

Notably, this commitment has been applied to our two largest contracts, one of which is the single largest IT procurement process in the state government you're probably all familiar with. Through this experience, we know firsthand how challenging, but also how essential this work is.

And that's why in order to fully realize the goals set forth in AB 2019, Controller Cohen, in partnership with Senator Richardson, is committed to creating the internal infrastructure necessary to not only meet but exceed the state's small business procurement goals.

We will continue to refine this proposal in the coming weeks and look forward to working with the committee members here and others to invest. To invest small businesses. Invest in small businesses that help form the backbone of our state's economy. And for these reasons, the controller respectfully requests your aye vote.

Thank you for your testimony. Any individuals like to register support for the bill? All right. Are there any principal witnesses in opposition? Seeing no one. Any individuals wishing to register opposition to the bill? Seeing no one. Will bring it to the committee for questions or action. Do you want to close center?

I respectfully ask for your I vote.

Thank you. Vice Chair Valladares has moved the bill.

Item 8, SB 656. Motion is due. Passed to Business, Professions and Economic Development.

[roll call]

Thank you. All right, we'll place that item on call. Thank you, Senator. Thank you. We'll take up and dispose of the consent calendar. Is there a motion? Moved by Senator Ochoa Bogh. Please call the roll.

[roll call]

Thank you. Consent calendars placed on call. We have an author here. File item number six, SB 833. Senator McNerney. Welcome, sir. Proceed when ready.

Good morning, Chairman and Members of the Committee. Excuse me. I'm here to talk about my favorite hot topic in the Senate. Here is artificial intelligence. You know, as you can see, AI is evolving very quickly and we need to keep ahead of that here in California.

And you know, California sets the standards for this kind of thing across the country. So a lot of eyes are looking at us right now. Maybe not on the TV, but over the nation. My Bill, SB 833. Will close a serious gap in AI safety.

Basically, there's no standard approach to monitoring AI systems that are in control of critical infrastructure such as transportation, energy, emergency services and financial services. So unchecked AI controlling these kinds of systems introduces significant risk. And SB 833 tries to address that risk by putting a human being in the loop. So in other words, we don't want AI.

We want AI to be involved in the control of these systems because they're complex and they need a lot of fast analysis and fast computation. But we want a human being in the loop to control the ultimate decision making by these AI systems. That's what 833 does, it keeps a human in the loop.

That's a phrase you'll be hearing more and more of. This Bill is common sense. It aligns with the governor's Executive order and it ensures innovation happens responsibly where lives and livelihoods are on the line. So again, it's common sense. With me to support this - this morning is Rob Eleveld from Transportation Coalition.ai.

Rob, would you make a presentation?

You'll have four minutes.

Thank you, Chair Padilla and Committee. My name is Rob Eleveld. I'm a co-founder of Transparency Coalition. Myself and my other co-founder and four of our staff spent more than 25 years in technology.

I personally ran four different small and medium sized businesses in tech and I'm testifying in support of SB 833. For increase and generally we're supportive of this and many other bills across multiple states that are focused on increased transparency and accountability for generative AI. SB 833 establishes human oversight for artificial intelligence systems deployed in California's critical infrastructure.

And it is limited to just critical infrastructure, which I think is important so it's not overreaching. Bill creates a framework to ensure AI systems in vital sectors are monitored, reviewed and regularly assessed for safety and performance. You can imagine this type of assessment has been done for air control systems and many other critical systems over the years.

This is not anything new. This is absolutely required for a technology that has a huge impact or control of these systems. SB 833 establishes a comprehensive framework for human oversight, as the Senator mentioned, and transparency, which we believe in of AI and critical infrastructure by four key areas.

One is establishing mechanisms for human oversight, monitoring AI systems in real time, and review, approve actions before execution, not after. Second, is directing the Department of Technology to administer specialized training and AI safety protocols and risk assessment techniques for oversight personnel. Third is requiring operators to conduct annual evaluations of their AI and automated decisions.

You see, when you ride up and down the elevator here, it's been reviewed every year. All sorts of systems that we rely on need reviews. It absolutely applies to artificial intelligence. And finally, number four is requiring operators to submit assessments and findings to the Department of Technology.

Importantly, the specialized training and the annual assessments both align with the Governor's Executive order. As these artificial intelligence systems become increasingly integrated into our critical infrastructure. And again, critical infrastructure is transportation, energy, food and agriculture, communications, emergency surfaces, and financial services. There is significant potential for both enhanced efficiency but also unprecedented risks.

This technology needs oversight, assessment and transparency mechanisms. Make no mistake about that. Currently there are no standardized approaches to human oversight of AI systems and critical infrastructure, creating a very inconsistent safety practice across vital sectors. SB 833 would go a long way to addressing these gaps and improving safety of AI artificial intelligence employed in critical infrastructure applications.

As well as aligning with the Governor's Executive order. I urge the Committee to stand up for California and pass SB 833 with a strong recommendation.

Thank you very much. Are there individuals who'd like to come forward, register support for the Bill. State your name and affiliation and position.

Hi. Yadi Younse, with Oakland Privacy and Support.

Thank you. Anyone else wish to register support for the Bill? Seeing no one. Are there any principal witnesses in opposition? Seeing none. Any individuals would like to register opposition to the Bill? Seeing no one. We will return it to the Committee for questions or action. Vice Chair Valladares.

Thank you. To the author. I have some concerns that this may actually take away some of the flexibility and the necessity necessity with AI with these very important - within these very important agencies and departments in emergency situations. I'd be much curious to know if there's been any studies. Has there been any data on the need for this?

Did you want to take that?

Do you want me to answer? Yeah. I don't think. Look, I spent five years in the Navy as a submarine officer. I've dealt with critical mission critical systems, operated a reactor plant, spent 25 years in tech.

There is nowhere I can imagine where you would want to deploy an AI system in an emergency without it being tested and assessed and the personnel trained on it. I can't imagine it in the Navy. We trained on critical systems and there was no time when you were ad limbing for emergencies.

It was absolutely a system that was evaluated and assessed. And I just would be very concerned about anybody who recommended using an AI system in an emergency without that sort of assessment and overview and review and humans understanding the implications of it. So that's just my own best knowledge.

But I've been 25 years in tech, and this idea that somehow, AI can run uncontrolled without human intervention and hopefully things will go well, I think it's a false assumption is my best recommendation. Through the chair.

Thanks for the question. I think it's something that we need to be concerned about. In emergencies, you need rapid response. But AI systems are well known to hallucinate. And with more training, they get better.

But there's always a chance for the AI to make a critical mistake that will cost, will be costly in lives or money or disruption. And there's plenty of evidence. I don't have studies in front of me, but if the Senator would like, I can produce studies.

We want to make sure that there's a human that prevents an AI hallucination from causing harm. That's basically the point of this. And it won't require calculations from the human being, it just requires training.

So from the Department of Technology so that the people that are put in that position of oversight understand the procedures and risks so that they can respond appropriately.

Thank you.

Thank you, Senator Ochoa Bogh.

Thank you, Senator Padilla. So on this particular issue, it's interesting because I was just watching a segment in which, and I'm trying to figure out where exactly you're coming in on this computer.

Because right now, it's my understanding within the next couple, next year or so, AI is going to be at a point where they literally will be able to be the smartest person in the room. They can self think and actually educate itself, learn from its mistakes and go on.

So basically, the notion of decoupling in about two to five years in which AI is independent thinking. And I guess it's very big, this understanding is very big in the San Francisco, Bay Area. Where many of these folks that are working in NAR are having these conversations.

So it was eye opening for me to understand that within the next year, or so AI will have the capacity to literally teach itself and rethink it and evaluate itself without the need of human component.

And at some point within the next, you know, within the next two to five years, literally decoupled from human. I guess, interaction don't need. And so as we're looking at this particular Bill, at what point - Because I'm trying to think, because I think the human component is very important.

But do you foresee at any point the human component not being able to literally intercede in the progression of AI and its technology applications?

Through the chair, I think you've raised a scenario that we're all kind of concerned about in this field. I mean, AI is growing sort of. I don't want to use the word exponential because I'm a mathematician, but AI is growing very rapidly. And it's capability, as you mentioned, General AI is - generative AI.

General AI is supposed to be overtaking human capabilities in almost every field within a few years. And that's in my mind, I think humans need to be in control and that means oversight. And this is a step in that direction.

If we require human beings in an oversight role in critical infrastructure, then that would establish a precedent for how we can maintain control of this technology before it gets out of hand.

Yeah, it was very eye opening to see this report and these professors speaking within this capacity. It was very, I don't say alarming, but it was an eye opening experience. And the reason I asked this question or make the statement is at some point it's going to be very, very difficult for human beings, depending.

And this is what I'm kind of curious as you know, what component do we have the ability to cut off? The ability for AI to be independent thinking, which at this rate they see that happening within the next two to five years.

Through the chair. The intent at this point is to have humans okay, before decisions are made and actions are taken by AI, by an AI system. So a system may decide to do something and then it has to get approval from the human being before it can take action.

Yeah, I think it's an important step in the direction you're discussing.

Yeah, it's a very fine line.

And the rest of the nation has been looking to California for our leadership in this kind of issue. Thank you. Through the chair.

All right. Thank you. Any other questions? I just wanted to note the Analysis Center. Thank you for the Bill. Obviously, I have a recommendation to support the Bill in the analysis.

With regard to human oversight, it does point out that it would not apply to an existing ADS. That's critical to state infrastructure if the required human oversight would cause a pause or destabilize the system. Can you or your lead witness address that, are we potentially leaving an existing operational issue unaddressed.

That hasn't been addressed in the Bill? If - If that's important to the Chair, then we can look at some language to, to amend that.

All right. Thank you, Senator. Just wanted to flag that. All right. Is there movement on the Bill? All right. Senator Ochoa Bogh moves the Bill. Please call the room.

SB 833, motion is due pass to Appropriations Committee. I'm sorry. Padilla, aye.

Ouch. I'm going to be in therapy for a while on that one. Thank you.

Archuleta. Ashby. Blakespear. Cervantes, aye. Cervantes, aye. Dahle. Hurtado. Jones, aye. Jones, aye. Ochoa Bogh, aye. Ochoa Bogh, aye. Richardson, aye. Richardson, aye. Rubio. Smallwood-Cuevas, aye. Smallwood-Cuevas, aye. Wahab. Weber Pierson, aye. Weber Pierson, aye.

Thank you. We'll place that item on call. Thank you, Senator. Thank you both. I see we have Senator Blakespear in the audience with respect to file item number one, SB 14. Welcome, Senator. Please proceed when ready.

Good morning. Thank you, Chair. Thank you, Colleagues. Would you like me to proceed, Chair? Yes. Okay. I'm here today to present SB 14, a measure that would position California state agencies and operations as a leader for waste reduction and the circular economy. I would like to begin by thanking the Committee staff for their work on this bill.

And I am accepting the Committee amendments. Every day, California sends 12,000 tons of plastic to landfills, enough to fill 219 Olympic sized swimming pools. That's every day. Across the United States, only 5 to 6% of plastic was recycled in 2021. Waste that isn't sent to landfills often ends up polluting communities and the environment.

Single use plastics are among the most extractive, wasteful, and harmful products in our society. One way to tackle the problem and reduce the enormous flow of waste is to move to a circular economy, which focuses on reusing and recycling products. SB 14 requires state agencies to walk the talk to advance our recycling and source reduction goals.

It also leverages the state's considerable purchasing power to support recycling markets by requiring that all state contracts for single use plastic bottles moving forward must be for bottles that are at least 90% post-consumer recycled content. SB 14 puts state agencies at the forefront of the circular economy, ahead of the statewide goals for post-consumer recycled content in plastic bottles that was established in AB 793 from Ting in 2021.

As a reminder, there are many options to single use plastic beverage containers, such as cartons and aluminum that people can easily use, as well as pitchers and washable glasses. Even the Legislature has moved to this by procuring aluminum water bottles. It is possible. Also, the 90% post-consumer recycled content requirement for bottles at state agencies includes exceptions.

These include bottles that are purchased for emergencies, water bottles sold at prison canteens, or given to pregnant women in prison, according to existing law. In addition, SB 14 requires state agencies to take more measures to reduce waste and recycle plastic and organic as part of their integrated waste management plans. Right now, each agency is responsible for developing an integrated waste management plan to divert 50% of the waste generated at state facilities from landfills.

SB 14 pushes state agencies to chart a course to move away from single use plastic food ware entirely, to encourage better education for sorting waste at state facilities, and to better ensure that plastic and organic material leaving state facilities actually gets recycled once it leaves the state building. With me today, I have Doug Kobold from California Product Stewardship Council and Marc Aprea from Republic Services.

Welcome, gentlemen. Please state your name again for the record. You'll have two minutes each.

Good morning. I am Doug Kobold. That's on. Okay, thank you. Good morning. I'm Doug Kobold, Executive Director for the California Product Stewardship Council. I'm also the Vice Chair of the SB 54 Producer Packaging, Plastic Packaging Reduction Act Advisory Board. I am also the Treasurer of the California Resource Recovery Association.

I wanted to step back for just one second and talk briefly about SB 54 because SB 54 does tackle reuse and source reduction. That's what we're also talking about here. What the Senator is trying to attempt to do is to reduce the amount of waste that's actually being generated to begin with.

But unfortunately, SB 54 does not touch on soda bottles and water bottles. Those are exempt in SB 54 because they have a California Redemption Value provision to them. So they are not actually being addressed in SB 54. So I really appreciate the Senator's efforts to bring this forward to try and reduce this in a different way.

SB 14 encourages source reduction by encouraging refill stations. An example, the CalEPA building just a few blocks away. I go there all the time. There is not a publicly accessible refill station, which is unfortunate. I'd love to see that. I complain about it all the time. It encourages the alternatives. As the Senator mentioned about aluminum cans or other glass bottles, or even more importantly, reusables. Reusables are the one key to reducing the amount of plastic waste that's generated by all of us. Aluminum cans been around a long time.

If you look at soda, soda was marketed in glass bottles first, then it went to aluminum cans, then to plastic, but it's still being marketed in aluminum cans. And the reality is that the cost for either in a soda, for example, the cost is the same whether it is a 12 ounce plastic bottle or 12 ounce can. There is no price difference from aluminum versus plastic.

Also, by pulling out the plastic bottles and encouraging more post-consumer content, you're going to help the MRFs to try and market better material for bottle to bottle recycling because they get paid more for a grade A bale over a grade B bale, which is typically your clamshells and plastic bottles mixed together.

I did a quick search on Internet real quick to find out. Pepsi sold at Walmart. You can get an 8 pack 12 ounce bottles in plastic for $8.77 but a 12 pack of 12 ounce cans, aluminum cans is $4.90, almost half the price. So the aluminum cost is not as significant difference as has been exclaimed.

Also, for vending machines, typically you're paying $2. So even if there is small cost differential between aluminum and plastic, it's not going to be seen in in the vending machines. The last thing I'd like to say is that... Sorry, my apologies. Oh. Having the state agencies leading, as the Senator mentioned, in the circular economy, this is one step closer to that circular economy. And I'm happy to answer any questions.

Mr. Chair, Members of the Committee, I'm Marc Aprea with Capitol Advocacy here on behalf of our client, Republic Services. First, we'd like to thank Senator Blakespear for introducing this measure and for presenting it before you today. As a solid waste service provider, Republic Services relies on the kinds of incentives that are provided for in this bill to ensure that recycling programs are successful. SB 14 provides or requires, rather, that single use plastic bottles have 90% post-consumer recycled content.

This will help create a market for recycled products and will provide a market and an incentive for the collection and processing of these post-consumer plastic goods. Secondly, in addition to setting recycling goals, SB 14 also requires state agencies to take more measures to reduce waste and recycle plastic and organic material as part of their integrated waste management plans.

As the Legislature and the Governor create public policies for the state to follow, this is an opportunity for the state buildings and state facilities to take the lead in moving forward with these recycling goals and these recycling processes. For these reasons, we urge your aye vote.

Thank you very much. Are there any individuals in the hearing room want to step forward, register support for the bill? Please state your name and affiliation and position on the bill.

Good morning, Mr. Chair, Members of the Committee. John Moffatt on behalf of Waste Management in support.

Good morning, Chair and Committee. Noam Elroi on behalf of the California Compost Coalition, RethinkWaste, and CR&R Environmental Services, all in support.

Thank you. Are there any principal witnesses in opposition to the bill? Please come forward. Thank you, gentlemen.

Thank you.

Welcome. Please state your name for the record again. You'll have two minutes each.

Thank you very much. Dennis Albiani, on behalf of the American Beverage Association, we appreciate the author's commitment to the environment, also her commitment to the bill and have met with the staff and those over time and worked on this, which want to point out that California has an extensive recycling system.

76% in the last audit of plastic beverages containers were recycled and brought back through the system. That is almost statistically the same amount as aluminum. So I think there's our system is very good, but it can get better. And that's where ABA wants to focus attention going forward is how do we get all these- every bottle back?

And so it's currently every bottle has a requirement of 25% recycled content and that moves up to 50% in 2030. That bill and that requirement has worked.

We now source recycled PET from all over the world because we're pulling it in to meet the standards and the sustainability requirements as well as the goals of many entities to have more recycled content. This creates a specific state bottle and that's going to require DGS and this is the government organization committee to review every single contract.

Those are contracts not only for state vending machines, but those are cafes that are in state buildings, are owned by small business entities. That includes fairs, it includes colleges. It includes all those requirements of every state facility.

It could also be folks that work out in the like Caltrans out in the roads that they have a vending machine in their office. Those kinds of contracts need to all be reviewed. And finally that will create additional costs. And finally it will also create logistical challenges because obviously California just doesn't produce for California.

We produce for other states and other states produce for California. And you can imagine having to make sure that that the state bottle specific is the only one in there. So with that, we would love to get that provision as the only provision of the bill that we are concerned about.

And if that was removed, we'd remove our opposition. Thank you.

Elizabeth Esquivel with the California Manufacturers and Technology Association. We also want to thank the author and her staff for the ongoing conversations and the dialogues regarding our concerns. We fully support California's sustainability goals and the author's intent. However, this bill as it's currently written would set unrealistic mandates that do not align with manufacturing capabilities.

It would introduce costly operation challenges for manufacturers as well. I think it's also important to acknowledge that high quality recycled plastic is in short supply and we cannot meet the demand

this bill would create in the required time frame. Forcing a 90% recycled content threshold risk driving up producer- produce- production cost disruption op- in operations and it would also increase costs for consumers including students, government employees and visitors.

We must also take note that the impact this would have on small and mid sized manufacturers who may not be able to absorb the cost and compliance burdens. And we instead urge the Legislature to focus on expanding and modernizing recycling collection infrastructure that, that where, that's where we will see the most significant and meaningful impact. Thank you.

Thank you both for your testimony. Are there any individuals who want to register opposition to the bill? Step forward. State your name, affiliation and position.

Mr. Chairman and Members. Eloy Garcia for the International Bottled Water Association in opposition.

Thank you. Any other individuals want to register opposition to the bill? Seeing no one come forward, we'll bring it back to the committee. Senator Jones.

I think one simple question and then a thought maybe. On the 90% post consumer product, where- how- how did we come to that number and is it hard and fast? Is it malleable at this point in time? You know, recognizing the witnesses in opposition saying that we're moving to 50% already.

Yeah, it's definitely not fixed. I appreciate the question. You know, we- we have been so first of all, the opposition has come in late. I think you may have noticed that there was no registered opposition before this.

And so yesterday I did have a meeting with them and unfortunately I think at this point they're trying to kill the bill in this committee. They're not wanting to go down to 80%, 70%, 50% or go to the goals that are established already earlier.

You know, there are a lot of different potentials and I think sometimes negotiation is you, you don't want to negotiate against yourself. So you think we're just going to stick with this bill needs to die.

So I mean I guess I would say that 90% because there are so many products that already say 100% recycled and there are so many alternatives to plastic and it has so many exclusions. It excludes milk, excludes 100% fruit juice, excludes emergencies, excludes prisons, excludes canteens. You know, there are, it- it actually is narrower than it seems.

And so I honestly would expect that percentage to come down. So I don't think it would if it comes through this committee that it will be at 90% when it comes to the floor of the senate. But at this point that's that was what we were starting with.

And it does seem like it is possible given how many products are actually sold with 100% recycled. So thank you.

Mr. Chair. If you wouldn't mind indulging me just a bit and maybe give the opposition an opportunity to respond on the late opposition comment, because our analysis has three or four registered opposition, and I- I just don't want that to go left unaddressed if- if there's some people that turned it in timely and other people were late.

I don't know.

We met with the consultant last, I believe it was Wednesday, and turned in our opposition at that, on Wednesday. It did grow from there. A couple other people added on. And so, you know, we- we had that. And we have been meeting with Ms.

Blakespeare's staff for, you know, maybe the greater part, trying to figure out what would be the opportunity to. On that provision and whether it would come out or not. And so we've had a few meetings with them prior to this. And so then obviously the time came and we needed to get the letter in.

Okay. So my understanding, Mr. Chair, is that both things are true. There was some timely opposition and some late opposition.

That sounds accurate?

I'm sorry?

Alright, great. Thank you.

That sounds accurate.

And I think, you know, fundamentally at this point, immaterial. There's opposition in the record, and I think the committee understands the points that have been raised by the opposition. I bring it back to the Committee for other questions or direction. Vice Chair Valladares.

Thank you, Mr. Chair. I can definitely appreciate the author's commitment. To reducing waste in California, and I- I share that same goal. However, I do have concerns on how this bill might impact affordability, equity, and the state's ability to serve our public, especially in our time of a very serious budget constraints. So I do have some questions, I

suppose, for the key witnesses in support. I don't know if they wanted to step forward.

So given the state's multibillion dollar deficit that we're facing, do we have a projected cost increase per contract for agencies on- that might affect service delivery, particularly in food service for students, for state workers, and originally I thought incarcerated in- individuals, but I understand that they're excluded. Our- Our prisons are excluded. Is that- Can you address that?

Alright, one second, Senator, who is the question directed to.

To the witness of- What was your name, sir?

Doug Kobold.

Doc.

Doug. Yeah.

Doug. Doug. To our witness in testimony of support of the bill.

Alright, Mr. Cobalt, please feel free to respond.

Senator, I- I can't answer the question on the amount of the contracts that you're asking for as far as the state. What I can tell you is certainly when you look at the universities, there are already universities that are starting to switch to reusables within the cafeterias in those spaces.

But then when you look at the vending machines, that's why I brought up the comment about the vending machines. When you go to purchase water, soda, anything in those vending machines, they're about $2. But you're- when you go to purchase these same products in the grocery stores, they're less than a dollar. There's quite a bit of markup.

And I also wanted- that's why I stressed also the difference cost of, say, an aluminum container versus a plastic container. We're not going to see a significant increase in the cost of bottling these products.

And therefore, it should be reasonable to assume that the- the amount of- of cost or the price of the product in the vending machine at $2 is going to definitely cover that cost. So the students should not see an increase, therefore.

So I would say we're not going to see a significant increase in the amount to the consumer, whether that's the University through vending machines or in the stores.

You know, I've ran a business, and. Anytime I have to change something, whether it's a service or a product, you have it, you incur more cost. Like that's just the reality.

And it does make me nervous that, you know, whether you're a student, whether you're a state worker, that those maybe it's a few pennies, maybe it's a dollar, but they add up, right? And they add up out of our monthly budgets. And that's very- that concerns me very much.

The other thing I'd like to know is, has there ever been an analysis of the proposed alternatives? I mean, if we're going to be moving to glass or to aluminum, is there potential for environmental harm with those alternatives down the road that we're unaware of?

Abso- Absolutely. And there have not been a lot here within the states. But if you look in Canada, where they are already removing some of these products from the shelves and going toward the more environmentally friendly alternatives, plastic is not the most environmentally- environmentally friendly alternative because of all the leaching, the microplastics.

Those concerns that are being raised more and more as we hear more and more about the health impacts of plastics in our environment and in our bodies. But then also on top of that, the EU is already banning most of these types of products.

And so California is probably the leading state in the nation trying to follow the lead of Canada and also the EU when it comes to these wasteful products and alternatives that are out there.

And if I may ask the opposition to weigh in, in terms of cost and any other thing you may want to bring up. I'd appreciate that.

Mr. Albiani. Alright, assuming it is, go ahead, state your name, please. Feel free to respond.

Thank you. Dennis Albiani, behalf of American Beverage Association. There's actually been quite a bit of review over the alternatives as well as all the different bottling opportunities, whether it's glass, aluminum or plastic. And again, American Beverage Association, we put our beverages in all those different containers and it really comes down to what the need is.

But when it comes to, for instance, CO2 plastic beverage bottle requires, they can be hauled and they get, you know, compressed down to- to nothing, baled and then reconstituted, have a much lower CO2 than glass or aluminum.

When you look at a life style- cycle analysis that has been well documented, and we could do that, you know, when you- when you travel with glass, you have to carry it both ways full, and it's very heavy and so and heavy takes more weight and- and more fuels and those kind of things.

Also, there's places where it's appropriate or it may not be appropriate. You may not want glass at a fair grounds that can be used essentially as a weapon, for lack of a better term, if it was, you know, full and- and used. So there's times when you would want to use one of the different alternatives.

And so with that, we- those are some of the issues. And obviously consumers prefer the ability to also refasten and- and those things. So there's a- there's a plethora of reasons of why you would use the different, the various different options. But yes, plastic has a very good CO2 profile. We appreciate that.

Thank you.

Would you like additional-

Mr. Chair, Senator Valladares, if I may ask through the chair. Respond through the chair. Your question is appropriate to ask about the- the cost, but I think you're only looking at half of the equation.

I would also ask that you consider the cost of your solid waste and recycling services to the extent that there is a robust market for recycled plastic, that will reduce the cost of your solid waste bill, whether you are at a residence or- or in a business environment.

And so I believe that as we look at these costs, we ought to look not just at the cost of the manufacturing of the product, but what is the cost for you, the consumer, to have- to recycle the product that you- that you're disposing of. And I think that looking at both of those will get you to the right number.

Alright, thank you. I think we'll move on. Thank you. Any other questions? Thank you, Senator. Does that conclude your question? Senator Richardson?

Thank you, Mr. Chair. I have a question for anyone who can answer it. When was the last time the percentage was increased?

Of the recycling?

Of the percentage of plastic.

Oh, just this year. It went from- it went up from 15% to 25% in the mandate.

Mr. Albiani, state your name.

Before you respond, go ahead, state your name in it.

Oh, sorry.

Thank you Chairman. Dennis Albiani on behalf of American Beverage Association. The- The requirements were- were increased this year, so it went from 15% to 25%. It'll go to 50% in 2030. And so, and that's the minimum requirement. And so and then some have, you know, marketing opportunities that are higher or- or- or more than that. But that's, it's continuing to go up.

But what we've seen is, we've seen as it worked, the, the market for our PET, recycled P-E-T has- is- has increased. And in fact, we're, you know, pulling in material from all over the world.

So I, I had an opportunity to speak, although it briefly with the author. First of all, I want to commend the author. I think that your work in the field of environmental, not only environmental justice, but environmental protection is probably one of the best in the senate.

And I think you continue to work to, you know, get us across the line of- of bettering. And so I want to certainly commend you for all of your efforts of that. And I think all of us of Californians are- are beneficial for all of your work. And Mr.

Apreia, who I've also known for many years since I was first here, I do know your commitment in terms of waste. It's been since I was here last in 2006. So we're talking about almost 20 years. So I know you have a tremendous commitment to increasing and getting us where we need to be.

However, today I'm going to vote no on this item, although I do reserve the right to change as we go through. And if changes are made, I'm certainly open to doing that on the floor. However, I just want to point out what my concern is. In my district, I have the Pepsi recycling not, excuse me, not recycling.

I have the Pepsi bottling manufacturing location in my district in Carson, California. And, so the reason why I asked the question when was this last done?

When you have companies and I have a consistent record of saying this and doing this when I was on GO 20 years ago, when we already have businesses that make the adjustment to go from 15 to 25 to now 2030 50%. A business doesn't decide that overnight. That's a major change.

I'd invite any of you to come to tours in my district to see a bottling plant, you know, when you're talking about the contents and the size and the machines that move everything around, it's not just, oh, I want to change it from 50 to 76 now. It's a major impact to that business.

And I've been fighting to keep that business in my district for years now. And so my concern is that change of requirement to that amount when we already have in place and increase to get us better. Certainly not where we would ultimately want to be, but certainly better.

I do want to point out though some positives of the bill that I support. In previous acts, they require agencies to develop and adopt a waste management plan to reduce solid waste, reuse materials whenever possible, recycle materials and so on.

I can tell you in my new apartment I just moved into, they gave me the little bucket, you know, that you're supposed to use. So I commend the many years of work that you've done to get us to doing better. And I support us getting better.

I just don't know with in place the businesses already having made this initial adjustment for 2030, to have them change again with would just come at such cost. And some may not be able to survive, frankly, because to have one particular bottle for California and something different for everyplace else.

That's why, in my opinion, we're losing a lot of businesses because for them to do things only for California, they're getting to the point, fine, you can have California and they're moving every place else. So I reserve the right to reconsider as you work through the process.

But I just wanted you to know a real live example in my district where we're actually doing bottling. And this has a significant impact. Thank you.

Alright, thank you, Senator. Are there any other comments or questions from members? Is there a motion?

May I close chair?

Yes, please. Feel free.

Okay, thank you. Thank you. Thank you for the comments, Senator Richardson, and I appreciate the witnesses and the opposition. There are just a couple level setting statements I want to make. So this doesn't ban plastic, it- it creates a market for recycled plastic. So we're trying to have the state, basically state agencies need to walk the talk.

And so when we say we want our state agencies to have at least one water refilling station, you know, that's something that they all should have. In the fact that CalEPA doesn't have that is- is a problem along with other problems. So we're trying to create a market for recycled plastic.

There is an enormous amount of plastic to recycle. So, you know, so this bill is aimed at that. It's also important just to say that there's no environmental analysis that a serious environmental analysis that thinks of plastic as a environmentally positive choice.

So, you know, while we can try to- to spin the facts to suggest that it- it is, plastic is a fossil fuel, come- comes from digging up the ground. It's extractive. It is the fossil fuel industry, is the plastics industry. So to the extent we have other alternatives, aluminum is infinitely recyclable.

So to the extent we have other alternatives, if you pay attention to your local, your- your life, you know that you're awash in plastic and you will still continue to be be even if we do make these- some of these shifts because so much of our life does come to us in plastic.

So as we try to get on top of that, recognizing the harms plastic causes and the places where we can make changes, that's- that's ultimately what the aim of this bill is, is to say we could do better with our state agencies.

There are several different areas which I'm really happy Senator Richardson mentioned, because there are other parts of the bill that aren't just that one that are very important. And ultimately we should get out ahead of the statewide goals and show what is possible in terms of sustainability and recycling. So.

And- And creating a market for more plastic, higher plastic recycling content, I think is a really important goal. So with that, I would respectfully ask for your aye vote.

And also just to say again that I do expect this bill to change as it goes through the process and that I would- I would hope that my colleagues would give me the courtesy to continue working on the bill. So thank you. Thank you very much, Chair.

Thank you, Senator. All right, thank you, Senator. Smallwood-Cuevas moves the bill. Please call the room.

Item on SB14. Motion is due pass as amended to Environmental Quality. [ROLL CALL]

Alright, thank you. We'll put that item on call. Thank you, Senator. Thank you, everyone, for your testimony. I think we have. Did I see Senator Stern? Oh, Senator Bettis is here. Alright. File item number three, SB465. Senator, welcome, and please proceed when ready.

Good morning, Chair and Members. First, I want to start by thanking Senator Padilla for joint authoring this bill with me and thanking the Committee staff for your work and collaboration on SB 465. SB 465, or the California Alerts Act, will create a statewide emergency alert system that is administered by Cal OES.

This statewide alert system will serve as a backup for locally operated emergency warning systems as well as a resource to assist addressing local government's emergency alerts issues and gaps. Issues with emergency alerts have persisted over several wildfire seasons, including the one that my district just experienced, leaving certain pockets of communities in the dark and without timely information.

This includes the 2025 January wildfires, when the emergency alert systems experienced issues while disseminating critical life saving information to over 200,000 residents that needed to be evacuated. Examples of those alert issues include notices being sent to unincorporated Altadena in my district, which were delayed more than nine hours after the Eaton Fire broke out.

Separately, alerts intended for a specific geographic area were mistakenly sent to all of Los Angeles County, causing widespread panic and confusion. Additional challenges with local emergency alert rollouts include the limited staff capacity, training, and experience. This can be an issue especially in smaller incorporated and under resourced communities, and even impact larger entities with dedicated staff and infrastructure.

For instance, when the January wildfires first broke out, there was just one person from Los Angeles County's Office of Emergency Management sending alerts for the Eaton, Palisades, and Hurst Fires using a new alerting software that they were not extensively trained to use.

While California's current emergency response infrastructure relies on local governments to maintain the primary responsibility even when the state becomes involved with a local incident, Cal OES has previously intervened to deliver emergency alerts. As these shortcomings happened during the 2025 January wildfires, Cal OES eventually had to step in to take over the alert system.

SB 465 aims to proactively prevent similar issues and alert messaging for future incidents by establishing California Alert, a state statewide WEA, or wireless emergency alerts system. Additionally, the bill ensures that emergency management offices receive the necessary support and backup to effectively issue alerts during real time emergencies by requiring the development of standardized guidelines.

Through these efforts, SB 465 will help ensure that Californians receive timely, accurate, and precise life saving alert notifications when future disasters occur. With me today, I have Christina DiCaro, lobbyist for SpectraRep and California Public Television.

Thank you. Welcome. You'll have four minutes.

Thank you, Mr. Chair and Members. Good morning. I'm Christina DiCaro. Ed Manning and I are the lobbyists for a partnership between California Public Television, which is all of the PBS stations in the state, and two technology groups, SpectraRep and Clover Alert, and we are in support of the bill.

We'd like to express our deep appreciation to Senator Perez and Chair Padilla for your vision, your leadership on this critically important issue. This bill is an opportunity to bring the brightest minds together at Cal OES and create a cutting edge system designed to provide emergency alerts to Californians.

Recent informational hearings, including one held by this Committee, discussed some of the benefits of creating an all hazards warning system. Those hearings also noted that there were recent failures to alert residents in some communities or communication channels failed or over alerting occurred, and all of this created confusion.

We also know that there are really hard areas to reach, pockets of the state that are in need of better tools for alerting. And we know that we need to provide alerts in multiple languages. Moving forward, the alerts must be clear, timely, and accurate and should be integrated with FEMA's national system for local alerting.

PBS and SpectraRep's interest in the bill is related to the provision allowing for the state to contract with a vendor for assistance in this effort. Now, you've seen public broadcasting towers in your community, but you may not know that they've been fortified to FEMA standards. They're virtually indestructible.

PBS stations also have the capability to dedicate some of our bandwidth for the use in alerting communities that a disaster is imminent for fires, floods, high wind events, et cetera. And thanks to the funding in the budget two years ago, the Senate played a big role in that.

California Public Television is now in partnership with Cal OES and technology companies to use our broadcast spectrum for early earthquake warnings. We want to build on that infrastructure to create an all hazards warning system under IPAWS, and we look forward to being part of these California Alert discussions. We want to thank, again, Senator Perez for her leadership on this issue.

Thank you for your testimony. Any individuals like to come forward, register support for the bill? Seeing no one come forward. Are there any principal witnesses in opposition? Seeing no one come forward. Any individuals want to register opposition to the bill? Seeing no one come forward. We'll bring it back to the Committee for questions or motions. Senator Cervantes moves the bill. Please call the roll.

Item three, SB 465. Motion is do pass to Appropriations Committee. [Roll Call]

Thank you. We'll place that item on call. Thank you, Senator.

Thank you.

All right, we have two items. If we have another author present. Before we do that, we have two file items. Five, SB 629, Durazo, and file item nine, SB 420 Padilla, that were heard in Committee as a sub. We have established a quorum. Does anyone want to move any of these? Dr. Weber Pierson moves file item number five, SB 629. Please call the roll.

[Roll Call]

Thank you. We'll place that file item on call. Is there action with respect to file item number nine, SB 420, Padilla? Thank you. Senator Weber Pierson moves the bill. Please call the roll.

[Roll Call]

Thank you. Place that item on call. All right, we have Senator Stern here. File item number four, SB 614. Welcome, Senator.

Thank you, Mr. Chair.

All right. Thank you, Mr. Chair. First, I just want to formally accept the committee's amendments. Thank them for their work. You'll see it in your analysis on pages 12 and 13 as we're also adding Senator McNerney as a principal coauthor.

SB 614 is a bill that creates a framework to ensure that any intrastate pipelines carrying carbon dioxide comply with really strong and world leading safety standards and a robust public process that empowers community input. In 2022, the legislature adopted SB 905 to create a state framework for carbon capture and sequestration.

And this framework includes an ongoing regulation by the Air Resources Board, but also requires regulations for moving carbon dioxide from the place it's recovered to the place it's stored. The process does have risks, though. Concentrated carbon dioxide is heavier than air and can displace oxygen if it escapes its pipeline.

Global experts, researchers, and scientists show that there is no path for the state or global carbon neutrality without carbon removal or sequestration. As noted in the IPCC 6th Assessment and CARB scoping plan. The bill is necessary because the new federal administration is taking direct aim at eliminating our state's ability to keep California safe through variety of efforts.

And for the past four years, though, in the previous administration, the Pipeline Hazardous Materials Safety Administration rigorously studied CO2 pipeline safety after a leak in Mississippi in 2020. In response, they published draft regulations back in January, but those regulations have here, have since been withdrawn.

This bill seeks to fill that gap left by a federal absence of regulatory action. The bill directs the Office of State Fire Marshal to adopt the Biden Administration's efforts into state law and allows for additional safety standards to be adopted as well by the Office of State Fire Marshal.

As you'll note from the committee analysis and the very useful amendments, this process would be initiated as a formal rulemaking by the Office of State Fire Marshal.

And that bill also includes an advisory committee to the state fire marshal as well as a civil penalty structure that allows the marshal to order a shutdown for violations that pose a threat to health and safety.

This bill is continuing to evolve with stakeholder and expert input and our office of is actually working bicamerally with a similar bill on the Assembly side from Assembly Member Petrie-Norris and a bicameral working group that has community, industry, academic, and safety experts. And we hope that through that process you'll hear some of those voices today.

But we hope through that process we can do this the California way to get work done, but to do it safely and in a way that empowers communities. You'll hear from some community groups today that this bill would prematurely end the intrastate pipeline moratorium.

But the way SB 905 is written allows the Trump Administration to simply conclude its rule making and leave California without any protection. So this bill is really here to be a stopgap in that eventuality and we hope that we can earn your aye vote. Thanks.

Thank you senator, you have a witness with you?

Yes.

Welcome Mr. Wetch. State your name and you'll have four minutes.

Mr. Chairman, members, Scott Wetch, on behalf of the California State Pipe Trades Council and the State Association of Electrical Workers. We were one of the proud lead supporters of the governor's clean energy package in 2022, the centerpiece being SB 905 by Senator Caballero.

As I think the committee's aware, the state scoping plan is dependent on getting 100 million metric tons of carbon sequestrated by 2045. Can't get there without CCUS.

When we did AB 905, there was a deal struck between the senate and the assembly and the governor's office to stall or delay piping of carbon until PHMSA, the federal agency, adopted pipeline safety standards.

The agreement also included or if the state fire marshal provided a report to the legislature by February 30th of 2023, that then there would be follow up legislation to authorize the state fire marshal to adopt safety standards.

We're now five plus years down the path and the window is closing for us to get these projects that are ready to go going forward. In the interim, we've had a new president elected and that, as the senator pointed out, has thrown into question exactly what the Trump Administration may do with those safety standards.

So this is really, we think, a really well directed effort, as is the assembly bill which we're sponsoring, to basically take what we refer to as the Biden standards, which have already gone through PHMSA and codify those into state law. In addition, giving the state fire marshal the authority to improve upon those standards if that's deemed necessary.

This is really essential. The window is closing. There's a 10 year sunset on the framework that was adopted in 905. The Biden, the money that the Biden Administration set aside to help make these projects economically feasible is being spent down quickly. And so this is really an essential element to meeting our 2045 goals.

And we would urge your support. It's still a work, work in progress. There's still refinements that need to be made and we look forward to continuing to work with the author to get those done.

Thank you, sir. Anyone else wish to register support for the bill, please come forward. State your name and affiliation and position on the bill.

Thank you, senator, members, Virgil Welch, California Carbon Solutions Coalition. We're a business labor coalition working to support deployment of carbon capture sequestration technologies. We do not have a formal support position, but as the senator mentioned and Mr. Wetch, there is a process underway. We very much support the intent and direction of that process. Thank you.

Anyone else wishing to register support for the bill? Seeing no one come forward. Are there any principal witnesses in opposition to the bill? If you're a principal witness, please come forward. Welcome. State your name for the record.

Good morning, members. Good morning, members, Marie Liu, on behalf of the Central California Environmental Justice Network. We have an opposed unless amended position. We sent in a letter along with our colleagues at the Leadership Council and CRPE. We want to thank the committee and the author for the amendments.

We think that the amendments bring a lot of clarity to the bill and we really appreciate the direction that it moves in. The state is looking at building hundreds of miles of carbon pipelines through the communities that we represent. Carbon pipelines pose a significant hazard risk and the existing regulations are, the existing regulations are definitely insufficient.

We appreciate the author's intent to make sure that California has strong regulations for the limited circumstances where the state can regulate. Carbon dioxide, as Senator Stern mentioned, stays in an event of a leak, stays in a dense cloud that provides, that is a real asphyxiation risk that can travel miles away from where the leak is causing.

Furthermore, it provides, it creates some unique emergency response conditions as well. As we saw in Satartia, Mississippi, internal combustion engines did not work because the oxygen levels in the air became too low. And so we want to make sure that the communities around, communities around the pipelines are prepared, are properly prepared for any incidences.

The bill asked the state fire marshal to build off the draft PHSMA regs, which were released publicly very, very briefly. They did not actually go through a full regulatory process.

So we believe that these further, these recent amendments to make sure that the state fire marshal goes through a full regulatory process is an important improvement in the bill. That said, we recognize that the draft PHSMA regs do have gaps in them that we have identified.

First and foremost, there is no requirement for an odorant or a colorant of any sort to help people recognize small leaks. Furthermore, there's a lack of detail that would prevent the state fire marshal from actually enforcing or enforcing or upholding their regulations, including for leak detection requirements and emergency planning.

We believe that the bill needs to require the state fire marshal to actually close these gaps before we start building carbon pipelines in California. We appreciate the work that the author has put through this, put on this, and we look forward to continuing to work with them.

Thank you for your testimony. Anybody else wish to register opposition to the bill, please come forward. Seeing no one come forward, we'll bring it back to the committee for questions. Vice Chair Valladares.

Thank you, Mr. Chair. So I am going to reluctantly support this bill because I do want it to move forward. I'm very. I like that you're working in, in the assembly on AB 881, which is important. I have the California Resource Corporation headquartered in my district.

I know that carbon sequestration and capture and transporting that CO2 is part of our only path to meeting our climate, a significant part of our path to meeting our climate goals in the future. But I have concerns that this is going to restrict that ability. I don't think that that's the intention. You want to do it safely.

I'm supportive of that, but I just wanted to let you know I'm going to support it today, but I reserve the right to change that vote because I want to see you work with some of the other stakeholders in making sure we get this right.

Okay, thank you, Senator.

Senator Richardson?

Yes, thank you, Mr. Chair. I also intend on supporting the bill. I just had one question and it's just something I'm not familiar with and didn't have an opportunity to get the answer to. It is CO2 transfer transported other than pipelines, meaning truck, rail, etc. Do we know.

I'm sorry. So in terms of what the bill covers?

Well, this bill is talking specifically about CO2 being transported via the pipeline.

Correct.

And so my question is, is it transported in other ways other than pipelines?

Currently, yes.

Meaning trucks and rail and so on.

Yes.

So is there a reason why we don't have these same requirements on the trucks and the rail also?

Why this Bill wouldn't apply? I mean, it's a different regulatory scheme. I don't exactly remember. I think it goes to some of the local public health authorities who cover some of the transportation requirements by truck.

And I think then there's a separate regime on rail just because they're all under slightly different federal arrangements too, like federal rails under a federal safety rules that, that govern how those, you know, those tanks move. We didn't want to sort of try to cover everything. We sort of just wanted to like stay on the intrastate pipe.

But in terms of why not apply some of these additional safety. I'm not, I'm not clear that some of these additional safety standards aren't already in place. But I'd have to get back to you on how it applies in the trucking and maybe lead witness might? No. Opposition? Yeah.

Yes, senator, Scott, which on behalf of California State Pipe Trades Council, I can't speak to the issue of what those safety standards are. It's typically just not economic to truck carbon in, in large quantities or to rail it.

And it also, it defeats the, it defeats our climate goals because the, you know, trucking cancels out many of the gains from sequestering the carbon because it creates carbon in trucking it. So that's, it's not widely used.

Okay. So I'll certainly follow up because my district is very labor intensive with the ports and we have several issues with trucks and rail carrying some of these hazardous materials. So given your history and your expertise on it, I'll look forward to working with you if in fact, these rules don't apply in a truck and rail situation.

But I certainly support your efforts today and the sponsor.

Thank you. We'll follow up with you for sure. Thank you.

Thank you, senator. Any other questions from the committee? Senator Weber Pierson.

Thank you, chair. I just really want to thank the author for tackling this issue. It's very complicated. I know there's a lot of work that you're going to continue to do to kind of shore up the bill, but it's definitely needed.

You know, one of the things I told I was talking to my staff about with this bill, it's not perfect, but we need to capture the carbon and we need to be able to do it everywhere. And it shouldn't be restricted to just certain places where they're able to store it.

We need to have the ability to capture it everywhere and move it to places where it can be stored. So that no community is left behind, especially those that have been disproportionately, proportionately impacted and have some of the higher issues with some of our environmental toxins right now.

So I really thank you for tackling this issue, grappling with it and, you know, look forward to supporting it today and also in the future and look forward to seeing what will come and also, you know, having the building trays come along because these are future jobs.

So as we are moving into a greener society, into our greener economy, we want to make sure that we're still training our workforce and allowing for them to have good jobs with livable wages as well.

So I want to thank, thank you so much for this bill and I look and I will move it at the appropriate time.

Thank you, senator. Any other questions? All right, senators, would you like to close?

Really appreciate the dialogue with the committee. We'll certainly follow up and want to again thank your staff for engaging and helping get this bill cleaned up in a state that even the opposition and those who are in support sort of they know what they're dealing with now.

We can sort of wrestle our way through this and it's an unfortunate circumstance that we don't have a pipeline hazard safety management, you know, administrator out there that we can lean on federally, but we're going to have to do safety on our own here and we're going to have to build and we're going to have to bring that abundance mentality to the work we do.

So with that, respectfully ask for your aye vote.

Thank you, senator. Senator Weber Pearson moves the bill. Please call the roll.

[ROLL CALL]

Thank you. Place that file item on call. That leads us to file item number seven, SB 247. Senator Smallwood-Cuevas. Our very own.

Senator, proceed when ready.

Thank you, Mr. Chair. And I want to start by saying thank you for working, the Committee working with my team on amendments, and I will be accepting those amendments. I wanted to just start by saying that SB 247 strengthens our commitment in California to equity in public infrastructure projects by offering up to a 10% bid preference to public infrastructure projects receiving federal grants that meet disadvantaged worker equity metrics.

This bill affirms that diversity, equity, and inclusion are essential to building a strong and sustainable workforce and economy. This bill really grows out of the work that this body did in 2023 when we supported the SB 150. This was an initiative to say that we should ensure labor standards and community benefits in our green public infrastructure projects.

It was successfully passed by the Senate and signed by the Governor. However, the metrics needed to be built upon in terms of recommendations to ensure that we are incentivizing our contractors to support reaching into our mostly disadvantaged communities and giving them opportunity to come out of poverty by getting on a pathway to quality careers.

This bill more specifically will ensure that projects receiving grants funds from the Infrastructure Investment Jobs act, the Inflation Reduction Act, and CHIPS Science Act, which we know we've already received some of those dollars, upwards of $35 million projects, would include a community benefit.

And this equity focused approach ensures that historically disadvantaged communities are not only included in the planning process, but also are direct benefits of this investment. I do not have witnesses today, and so I respectfully ask for your aye vote.

Thank you. Since we have no witnesses in support today, is there anyone who would like to me too in support? Do we have any key witnesses in opposition? Please state your name. You'll have four minutes.

Madam Chair, Members of the Committee, Scott Govenar and on behalf of the Construction Employers Association. They are the largest union signatory building contractors in the state. Have also been asked to speak for the National Electrical Contractors Association, Sheet Metal and Air Conditioning Contractors Association, United Contractors, and those entities listed in the analysis as well.

We don't object to the author's goal. The problem is our members are bound to collective bargaining agreements and those agreements dictate who we must hire. Our members don't have the ability to reject workers who are dispatched from the hiring hall based on where those workers may live.

I think this measure addresses kind of the end and not the middle. And that is to the extent we want to increase diversity and equity, perhaps direct the hiring halls to dispatch only workers from, you know, in compliance with the bill. Because, again, our members can't reject workers and that was done to kind of minimize discrimination.

So we're in a bind. And as a result, the bill actually benefits non-union contractors because they have the latitude to pick and choose workers. So we look forward to working with the author and hope we can resolve this to address the hiring hall issue. Thank you.

Thank you. Is there anyone else here in opposition that would like to state their name? Seeing none. Let's bring this back to the Committee. Senator Richardson.

Thank you, Madam Chair. I'm prepared to support the bill today. I was not aware of the opposition prior to today, but I will look more into what has been shared. I would just say as a suggestion, which is also neighboring your district. We had a very successful way that, for example, SoFi was built, where it included all of the various unions in the area and they did have a certain threshold of where we were trying to hire people from the district.

So maybe we could go back and look at some of that language and see how the two might be married together. But we did very successfully do that for several years. And the workers who were more journeymen or more longer term who were maybe first up on the list were able to participate in work, and then there were also newer people who were coming in as apprentice and so on that were able to take advantage as well. So I wasn't here at the time when that whole contract was negotiated.

But maybe between now and as this bill progresses, we could take a look at some of that language that might help marry that we still... You know, and I do understand workers who've already been on the list and who've been doing, you know, their job want to make sure that, you know, first in, you know, that they have that opportunity. But we also want to build, you know, this next generation as well. So I'll support today, but I'm hoping maybe we can have further conversations about how to, how we might marry the two. Thank you.

I understand that we have additional opposition witness here for testimony.

Thank you, Senator. Sorry, I was in another Committee. Todd Bloomstine on behalf of the Southern California Contractors Association in respectful opposition.

Thank you. Is there any other comments from the Committee? Senator, would you like to close?

Thank you. And really appreciate your comments, Senator Richardson, and am working with the opposition on this. And you're exactly right. In our county, there are hundreds of projects that are done with community benefits agreements and with project labor agreements.

I helped to be part of a coalition that ensured that the 23 new rail lines built in Los Angeles County had a construction careers policy, which essentially says that we want to make sure we are pulling our most disadvantaged, our most economically disadvantaged communities out of poverty by ensuring that there are a set aside of jobs for those individuals who meet the criteria.

And those projects were built on time, under, in some cases under budget, and has been a very effective way of building construction. Unfortunately, the state does not have a metrics for that. It's not a standard, it's not a universal way of operating, as it certainly has become in Los Angeles County, in parts of, certainly, Alameda County.

And, you know, UC Davis is another example of a model where you have a partnership between labor unions and contractors and community and government to say, we're going to have these dollars be a multiplier. We're going to build our infrastructure, we're going to pull folks out of poverty, and we're going to make sure that we're growing our economies together. So, you know, I look forward to continuing to work with the opposition on this.

I think the State of California has, you know, all that we need to be able to create multipliers in our economy in a time when every dollar is so scarce, and we just have to look at it in a different way and be committed to building on lessons learned. And this is an opportunity to do that. So with that, I respectfully ask for your aye vote.

Thank you. Do we have a motion? Senator... Oh, all right. Secretary, please call the roll.

Item seven, SB 247. Motion is do pass to Appropriations Committee. [Roll Call]

What is the vote?

Three to one. That bill's still on call. We're now going to lift file item number one. SB zero, let's start with the consent calendar. We're going to open the file for consent calendar. Secretary, please call the roll.

[Roll Call]

Eight to zero. We'll leave that on call. Now we will be moving to File item number one. SB14. Blake, spear. Secretary, please call the roll.

[Roll Call]

That's five to two right now. Five to two. That Bill is on call. Now move to File item number three. SB465. Perez Secretary call the roll.

[Roll Call]

Six to zero. That's on call. We'll now move to File item number four. SB614. Stern. Secretary, please call the roll.

[Roll Call]

It's still 60. That is on call. Now let's move to File item number 5. SB 629 by Durazo.

[Roll Call]

That Bill is still on call. Now moving to File item number six. SB833. Senator McNerney, please call the roll.

Absent Members Valladares. Archuleta, Ashby, Blakespear. Aye. Blakespear. Aye. Dali, Hurtado, Rubio, Wahab.

That's 8 to 0. 8 to 0. That Bill is on call. Now move to File item number 7. SB247. Secretary, please call the roll.

[Roll Call]

That's four to two. Four to two. That Bill is on call. Now moving to File item number 8. SB656. Secretary, please call the roll.

[Roll Call]

Now moving to File item number nine. SB420. Padilla. Secretary, please call the roll.

[Roll Call]

That Bill is seven to three and still on call. We'll now move back to the consent calendar. When the secretary is ready, call the roll.

[Roll Call]

11 to 0. Consent is still on call. Our Members. Now moving to File item number one. SB14. Blakespear.

[Roll Call]

Six to four. Six to four. That Bill is on call. Now move to File item number three. SB465. Secretary, call the roll.

[Roll Call]

10 to 0. That Bill is still on call. Now move to File item number four. SB614 Stern. Secretary call the roll.

[Roll Call]

That's eight to one. That bill's eight to one and still on call. Move to file item number five. SB629. Secretary, please call. On file item number five. 7-0.

[Roll Call]

Nine to zero. That Bill is still on call. Now move to File item number six. SB833.

[Roll Call]

10 to zero. That Bill is still on call. Now move to File item number 7. SB247. Secretary, please call the roll.

[Roll Call]

Seven to three. Seven to three. That Bill is still on the call. Now move to File item number 8. SB656. Secretary, please call the roll.

[Roll Call]

Right now. That Bill is 10 to 0 and still on call. Now move to File item number 9. SB420. Padilla. Absent Members

[Roll Call]

That Bill is eight to three and still on call. So let's move back to the consent calendar. Secretary, please call the roll.

[Roll Call]

12-0 still on call. Let's move to file item number one. SB14, please call the roll. Absent Members.

[Roll Call]

That's six to four. Six to four. File item one is still on call. File item number three. SB 465. Secretary, please call the roll.

[Roll Call]

11 to 0. That Bill is still on call. And final item number four, SB614 Stern.

[Roll Call]