Assembly Standing Committee on Transportation

The Assembly Transportation Committee is called to order. Good afternoon and welcome, everyone. The hearing room is open for attendance of this hearing, and it can be watched from a live stream on the Assembly's website.

We seek to protect the rights of all who participate in the legislative process so that we can have effective deliberation and decisions on the critical issues facing California in order to facilitate the goal of the hearing as much from the public within the limits of our time, we will not permit conduct that disrupts, disturbs or otherwise impedes the orderly conduct of legislative proceedings.

We will not accept disruptive behavior or behavior that incites or threatens violence. We encourage the public to provide written testimony by visiting the committee website. Please note that any written testimony submitted to the committee is considered public comment and may be read into the record or reprinted.

We will allow two minutes each for two primary witnesses in support and opposition of the bill. As a reminder, primary witnesses in support must be those accompanying the author who otherwise have registered a support position with the committee. And the primary witnesses in opposition must have their opposition registered with the committee.

All other support in opposition can be stated at the standing mic when appropriate and when called upon to simply state name, affiliation and position, also known as me too comments. With that, we will begin our hearing. Because we do not yet have a quorum, we will start as a subcommittee.

We also note that the Senate is, I believe, still in session, are they not? They are still in session. So we are waiting for authors, and so until then we are on recess. Thank you. All right. The Transportation Committee is returning from recess. We do have a senate author now present.

As a reminder, we are starting as a subcommittee. The moment though we have our a quorum present, we will go into a committee and so to be able to take action on the bills that we're hearing today. So I ask that members of the Transportation Committee to make their way to the assembly hearing room.

With that, moving to where we have we do normally go and file item order, and deviate from that when we have authors in the room. And so with that, we're going to move to File Item number 12, SB712. Senator Grove, you may begin at your convenience.

And as a reminder to our witnesses in the room, you each have two minutes for those that support the bill, and those that are in each for those that support the bill and those are in opposition to the bill.

Thank you, Madam Chair. Thank you. First, I want to sincerely thank you and the committee staff for engaging in meaningful discussions to move the bill forward.

We've personally talked and text on numerous occasions after hours, early hours in the morning, and you have been really committed to help me move this bill forward, and I just thank you for your leadership on that. Also want to thank the Senate Transportation Chair, Senator Cortese.

He's my joint author, and he has just been an incredible advocate for this bill. He actually is a classic car owner, and he understands it. And a funny story, it was his mechanic that called and said call Dave Cortese because he owns classic cars. So I thought that was really good that this is a true bipartisan bill.

I will be accepting the committee's amendments. I thank you for going again back and forth with the committee amendments as I didn't understand what was dropped, what was brought forth, and you were very gracious with your time with these amendments.

Amendment Senate Bill 712, also known as Leno's Law, will be extending, will extend a full smog check exemption for classic vehicles with model years 1976 to 1986, adding 10 additional years phased in over a five-year period with a sunset provision in 2032.

Amendments taken in the Senate Appropriations Committee ensure that the exemption only applies to classic and collectible cars, requiring collector motor vehicle insurance and registration of a historic license plate through the DMV, and the program is optional, not mandatory. The means of the means, this means that this bill is narrowly tailored to address concerns about self-certification.

To qualify for a classic historic motor vehicle insurance, owners must limit the mileage driven each year and maintain a separate daily driving vehicle to ensure compliance. In some cases, additional requirements apply,y such as storing the vehicle in a locked garage or behind a locked fence.

This is stringent safeguards to ensure that only true classic car vehicles qualify for the insurance and therefore for smog check exemptions. Previously, California had led a 25-year rolling smog check exemption for certain vehicles, which ended in 2005.

Leno's Law would have restored that modernization with that exemption, adding an additional 10 years to reflect the passage of time, responding to a long-standing request by car collectors.

According to the California DMV, vehicles manufactured between 1976 and 1991 make up only one percent of all the registered vehicles in the state and the number is considered true classic car owners is significantly lower than that number. We're talking about less than one percent of the registered vehicles being eligible under the original 35-year exemption.

Now with that exemption has been narrowed to just 10 years, the impact should only be a fraction of that. Well under one percent of the vehicles registered in California.

My joint author has just joined us, and I'll just briefly tell him I did compliment you very much so for being the Senate Transportation Chair and understanding and helping me with this bill. The unfortunate reality is in the many California smog check stations are not equipped with the tools necessary to perform emissions tests for these classic vehicles.

There are a lot of smog check stations in all of our districts, but very few of them have this particular piece of equipment that allows the tires to roll.

And for the instrument to be put up the tailpipe to measure the carbon emissions after 1995, you just plug it into the dash, and it makes things a lot simpler.

I can tell you that car enthusiasts across the state have contacted my office to express how difficult it is to find a smog check station with the appropriate equipment to test their vehicles. The intent of Leno's Law is to create less burden for owners of classic cars that are rarely driven and kept in beautiful mint condition.

Although Jay Leno couldn't be here today to testify at this hearing, I'm glad that he was a sponsor of this bill and brought it to my attention when I went down on a tour of his garage. These cars are rolling pieces of history.

They're rich in culture, craftsmanship, and meaning, and they deserve to be preserved for generations to come. In many cases, classic car vehicles are sold out of state due to the stringent smog check requirements, specifically on the time of transfer and meaning that California doesn't receive the economic benefits for that.

This, to put it in perspective, the specialty automotive equipment aftermarket industry contributes 40 billion. That's 40 billion dollars of activity through California. And we benefit from about 150,000 jobs throughout our state. And 6.16 billion dollars in tax revenue is tied to this sector. It expends, it extends to tire shops, paint shops, upholstery shops.

There was a lowrider candy apple red Impala that was next to us, bouncing down the road at the parade that we had. And they had invested a lot of time and money into just the specialty diamond-tucked interior. Enthusiasts modified their cars to lowriders and gave them elaborate color paint jobs. This is a cultural thing.

Just recently, in the past few years, the governor signed a bill legalizing cruising again for lowrider clubs. SB712 builds on that commitment to sure that individuals, regardless of background, can participate in car culture and enjoy the right to preserve their vehicles.

My hope is that when I introduce Leno's Law was to provide a full exemption for vehicles 35 years or older and upon transfer. I've heard from many car enthusiasts across the state about the concern for changing out their original plates. And they didn't want to, you know, they didn't want to have.

They want to use their original plates and the in-stock plates, and not the DMV plates. But I know that they know this program is optional, only available to them as an option to be able to get the smog exemption. But I also know that SB712 remains a meaningful step forward for collector car enthusiasts.

I'm grateful to have the opportunity to advance this bill today and secure your vote. Respectfully ask for an aye vote. And I think I'm just going to turn it over to my principal, joint author.

I'm proud to be a joint author of the bill, and I just want to thank. I happen to know firsthand how much work the chair and the committee have done on this bill, and I just want to thank everyone involved for getting it to this point. And I'll stop there and turn it over to the witnesses.

Thank you. With me here to testify today, Madam Chair, is Francine Mata. She is the president of Sacramento's Lowrider Commission, along with, excuse me, the California Lowrider Alliance. She helped author the support of Alvarez in passing in AB436, which repealed the city and county no-cruising ordinances.

And also Victor Muñoz, representing the Specialty Equipment Market Association SEMA, who represents about 7,000 small businesses nationwide.

Good afternoon, and thank you for having me. Thank you, Shannon Grove. My name is Francine Mata. I'm honored to stand before you today as the president of the Sacramento Lowrider Commission as well as the California Lowrider Alliance.

The SLC is a non-profit organization proudly rooted in the preservation, education, and celebration of lowrider, our lowrider culture, and lifestyle. I'm here in strong support of Senate Bill 712, also known as Leno's Law, because this bill represents far more than change in smog check requirements.

It's about preserving culture, protecting history, and promoting equity for collectors, communities, and California's rich car culture. Lowriding has always been more than just cars. It's art on wheels. It's a rolling expression of heritage, identity, and creativity. It brings together our families, our generations, and our neighborhoods. It builds community, it sparks joy, and yes, it heals.

Even during the pandemic, we saw how lowriding brought people peace and purpose. That's how culture started. Research shows cultural connection improves your mental health. As for many of us, cruising is our therapy.

However, many lowrider and classic car owners have a very difficult time finding smog stations that have the correct equipment and will do it for a reasonable price. Because maintaining the Bar 97 emissions equipment required to test these older cars is costly, and it's rarely used.

This leaves us with an inability to get our vehicles smogged, ensuring we are compliant with state law. SB12 offers a practical and cultural aware solution, exempting collector cars from California's smog check program. These vehicles are not just daily drivers. They are rarely used, carefully maintained, and deeply loved for our cultural and historic value.

This is the first time in over 20 years that California is expanding the smog exemption beyond 1976, making this a historic win for car enthusiasts and communities who have long been overlooked. While the current language does not include everything that our community has hoped for, it is meaningful progress that moves us in the right direction.

It provides overdue to owners. Sorry. Well, I'll just skip to this. That lowriders aren't just a tradition, they're an economic engine. Here in Sacramento, our community hosts over 80 to 100 events a year. That's more than 1500 hours of community service it brings.

And I'll have to have you wrap up.

And I'll have to have you stop.

Mr. Muñoz.

Okay. Okay. Thank you so much, and respectfully ask for your support. All right. Thank you.

Well, thank you so much. Chair and members, my name is Victor Muñoz with the Specialty Equipment Market Association. I'll make my comments brief. I'm here for technical support. And just briefly mention that SEMA represents over 7,500 companies nationwide, with 1,500 here in California.

And our Members employ the 150,000 that Senator Grove was mentioning, and that fuels the 40 billion dollar aftermarket economy here in the state. And the author's office has worked with the senate to ensure safeguards for this practice.

And SEMA believes that this version of the bill improves on current law and ensures future generations have access to car culture without unnecessary barriers. And so, on behalf of SEMA and our members and the next generation of car enthusiasts, I respectfully urge your support of SB712. And here for any questions you may have.

Thank you. Now, moving on, members of the public who are present who would like to add on their support, name, affiliation, and position, please.

Joseph McBeans, random car enthusiast, in support.

Thank you, Chair and members. Ryan Pierini, on behalf of the California Automotive Wholesalers Association, in support, thank you.

Madam Chair, members, Andrew Antwih here today on behalf of San Joaquin County Supervisor Robert Rickman and San Joaquin Supervisor Mario Garda, in support.

Jerry Thompson, Modesto, Cruisers Culture of Modesto, also a member of California Lowrider Alliance, in support of seven, SB712.

Thank you. Now moving on to members of the public in opposition. We do have two witnesses who are in opposition. And so if we can maybe flip so where there's two seats together, however you want to, just move multiple people move down. Oh, wait, okay, you can. They're putting you in the middle center seat. Okay. Yeah.

Just make sure you press the mic button. And as a reminder, you have. We did go a little long on one, but short on the other. So two minutes and 15 seconds. So please.

Yeah. Well, thank you. It's very gracious. I don't want to take the spot of a senator, but here I am. Brendan Twohig, on behalf of the California Air Pollution Control Officers Association, which are the air pollution control officers from all 35 local air districts. And we are respectfully opposed to the amended version of the bill.

Air districts don't administer the smog check program, but we're supporters because it's an equitable way of achieving emissions reductions essential to meeting federal health-based attainment standards. And while we appreciate California's rich automotive history and heritage, unfortunately, this bill will substantially increase air pollution and harm public health.

So whether a car is a collector is largely self-defined. And this bill allows 10 years of cars an exemption from the smog check program as long as the owner has collector car insurance and also self-certifies to the DMV that it is a historic vehicle, and they get the specialty plate.

So the numbers of vehicles exempted could be significant. Hagerty, which is one of the large insurers of collector car insurance, says that there are 43 million cars in the United States that meet their criteria of a collector. And in fact, the collector car insurance we see with that, there's very little accountability.

The accountability system here is the smog check program. And also, the mileage restrictions, like for Hagerty, are 7,500 miles a year. So that's relatively high.

And I would point out that under the smog check program, cars don't have to meet the same emission standards as when they were new or even the same standards or today's new cars or even when they were new, because that's because the program takes into consideration the expected deterioration of the emissions control equipment.

CARB data shows us that 1982 passenger vehicle that passes actually passes the smog check program emits 123 times the NOx emissions of a 2025 car. And so if you play that out and you look at the like operating under the mileage limits for Hagerty at 7,500 miles, yes, that's 922,500 miles.

So I will just say it's important that cars go to smog because otherwise, the equipment can be tampered with. And at a time when the federal government is rolling back on clean air, now is not the time, I think, to impose something self-inflicted. Thank you, Madam Chair.

Thank you.

Good afternoon, Chair, members, Mariela Racho. The American Lung Association remains in strong opposition to this bill. Our state remains home to some of the most difficult air pollution challenges in the United States.

According to the American Lung Association State of the Air Report, which release annually. The transportation sector is responsible for approximately 80% of smog-forming emissions and approximately half of the climate foreseen greenhouse gases. Meaning Californians depend on smog checks and other effective clean air programs to maintain strong progress towards healthier air.

Breathing unhealthy air can trigger asthma attacks, heart attacks, stroke, developmental impacts on children, impacts on pregnancy, and premature death.

The Health Effects Institute's recent review of hundreds of peer-reviewed studies concluded that transportation-related pollution is associated with premature death, death due to heart attacks, lung cancer death, onset asthma in children and adults, respiratory infections in children, and other health emergencies.

This is why California smog check program for light-duty vehicles is so important and why we oppose expanding exemptions as proposed by SB712. The program benefits the health of other public of the public by ensuring motor vehicles older and newer, operate within acceptable standards and maintain functional pollution controls. While the federal government is working to strike clean air and health care protections, we cannot afford to willingly let more pollution into our air. So we ask for a no vote. Thank you.

Thank you. Now moving on to members of the public who would like to add on their testimony in opposition, please come to the mic and note name, affiliation, and position. Thank you.

Allen Abbs with the Bay Area Air Quality Management District, in strong opposition.

Chris Chavez with Coalition for Clean Air in opposition.

Good afternoon. Jakob Evans with Sierra Club California, in opposition.

Rebecca Marcus, on behalf of the Union of Concerned Scientists,in opposition.

Ana Gonzalez, representing the Center for Community Action and Environmental Justice, San Bernardino Riverside Counties, in opposition.

Edie Schweigerdt, Sacramento Area Bicycle Advocates, in strong opposition.

Ron Brazel, Meadowview Urban Tree Project, in opposition.

Jeanie Ward-Waller, representing Natural Resources Defense Council, NRDC, in opposition.

Luca Davis, on behalf of the Sacramento Area Bicycle Advocates, in strong opposition.

Jeremiah Rohr, breathing citizen, opposed.

Melissa Romero, California Environmental Voters, in opposition.

Thank you. Now, bringing it back to committee was just confirming we do still do not have a quorum, but so we are operating as a subcommittee. I wanted to give an opportunity for members of our committee to make any comments, or if they have any questions. Seeing none, oh wait, our Vice Chair Davies.

Thank you, Senator and Senator, for bringing the bill forward. I can tell you that in San Diego area and Orange County, this is, to me, one of the incredible things with classic cars is it brings families together.

There isn't a weekend that doesn't go by that we don't have some type of event where generations are learning the beauty and enjoying this. I also just want to make a point that these are a lot of times just recreational cars. They're not driven on the road every single day.

If you take a look at this, you know what kind of condition they're in.

Lackey.

You know that they come up perhaps sometimes for parades or for an event, but if you look at the time they're actually driving compared to all of us that are out there driving our vehicles, the emissions aren't is, you know, are not that high. So I like this bill and like to support it. Thank you.

I'm going to hold my tongue because I think the opposition is very extreme, and they've indicated that if you're not environmentally pure, you're unacceptable. That's really what is being stated here because. And we have to look at the benefits. What the argument does not negate the benefits that are achieved. There's financial benefits, there's relationship.

I mean, we see the cultural benefits. There are all sorts of other benefits that just get totally dismissed. I think that's unfair, and I think you're to be commended for bringing this bill forward because it's reasonable. So I appreciate your thought process, and if I'm not a co-author, I certainly would like to be. Thank you.

Okay. Seeing no other comments, I'll note. I appreciate all the robust conversation.

As the Senator noted that we had, along with the chair, my counterpart in the Senate, we talked quite a bit about this bill and trying to strike a balance, recognizing the impact, potential impact to the air, as was noted from opposition and generally, we do have to focus on, on making sure we have clean air for folks.

And part of that is through our smog program. But also recognizing that there is this small number of vehicles typically who should be able to take advantage of an exemption like a 1976 or prior. I think we found a good Balance to be able to do that. We also sunsetted it.

So there is another point for the legislature to consider the impact, the number of vehicles that actually it applied to, and whether it's something to continue or what else can be done. And so that was important to me.

And so with that, at the appropriate time, I will be supporting the bill and look forward to the continued discussion on this. And we might just have a quorum. So hold on one second. Do we do. Yes. Okay. We do have a quorum.

So if you want to wait, we can take action on your bill once we establish that quorum. While we're getting things settled, I'd like to note we do have a witness that has to leave and catch a flight.

So once we dispense with this bill, we're going to move to item file, item number 16, SB800 Reyes, which will be presented by Senator Richardson. And then once that bill is dispensed with, we'll go back to file item order with that. Madam Secretary, please call the roll.

[Roll Call]

I'll pause you for a second. I should have said here and not I. I started off. We are saying that we are here. And so.

[Roll Call]

All right, we've established a quorum. We are currently hearing Senate Bill 712, item number 12, by Senator Grove. We did have members step in. And so before we. Before I asked for a motion, I wanted to make sure that no members who just arrived wanted to comment on this bill or have any questions.

Seeing none, I'll entertain a motion. Moved by Lackey. Seconded by Davies. Madam Secretary. Oh, I'll give it to the author. Would you like to, ether author, would you like to close?

Yes. See the author. I do want to, I do want to defer to Senator Grove in a moment here, because, you know, this bill was a bipartisan bill from the moment she started to talk to people actually on the floor, which is Senator Groves.

Oftentimes her, her way of getting to the point of consensus on things like this. And I was an early support of this bill, not just as Senate Transportation Chair, as, as were several other members of the Senate on both sides of the aisle.

And I think it's because there was a tremendous amount of faith from the beginning that this issue, which is to some degree a series of nuanced issues around what happens with 76 and newer vehicles that just can't.

That are just where people are just stuck between a rock and a hard place in terms of even achieving a smog test or smog check, or the actual certificate.

You know, I think there was a feeling right through committee, right through a very strong four vote in the Senate, that this bill would progress to the point of reaching the equilibrium, Madam Chair, that you were just talking about. And again, I just want to thank you and thank the committee staff for sticking with it.

It's a tough bill. It was a little bit of a tricky bill to thread the needle, as we say sometimes. And I think that's been done here. And I would respectfully urge an aye vote.

Thank you.

Thank you, Madam Chair. And again, thank you again for working with me on the committee amendments. Like I said, we in my comments that we went for a 35-year rollover to cover that entire gap of cars that were covered.

But moving the bill Forward with a 10-year extension on this with, you know, five years in it incrementally, but five years in additional immediately is really a compromise that I think is good for a car enthusiast and those that are exploring cultural history.

And I do think that even with the opposition, we did address those issues. I worked very well with the chair, who is a car enthusiast himself. We didn't affect vehicle code 279, which already outlines that a collector vehicle is, quote, a collector vehicle, meaning the vehicle owned by a collector is defined by subdivision A, section 5051.

And the motor vehicle code is used, the motor vehicle is primarily used for show shows, parades, charitable functions, and historical exhibitions on display, maintenance, and preservation, and is not used for primary transportation.

And again, on the issue on the carbon or the NOx emissions, it is true that older cars had higher NOx emissions, but the numbers that were thrown out and the numbers in the analysis, just to point out it would be equivalent to driving one of these old cars 369,000 miles a year total.

And they're not going to do that. These cars are incredibly restored, and they're a work of art. And I just respectfully ask for an aye vote, and thank you for your help on this bill.

Thank you. Now moving to roll call. Madam Secretary.

[Roll Call]

We have nine votes. We'll hold the roll open for members to add on.

Thank you, Madam Chair.

Thank you. As we transition to item number 16, we'll dispense with the consent calendar. There are six bills on our proposed consent calendar. File item 5, SB 76. File item 7, SB 506. File item 10, SB 671. File item 14, SB 731. File item 17, SCR 79. File item 18, ACR 101.

Is there a motion for the consent calendar? Then moved by Davies, seconded by Ahrens. Madam Secretary, could you please call the roll?

[ROLL CALL]

There are 10 aye votes. We'll leave the roll open for Members to add on. We did have 11 bills to discuss today. Please noting, also noting that we will not be hearing file item 8, SB 569, Blakespear, which has been pulled by the author. We've already dispensed with file item 12.

We will be going now to file item 16, SB 800 and then resume file item order. Senator, you may begin at your convenience.

Thank you, Madam Chair. Before I begin my begin my comments, I want to make sure to thank the Chair on the Senate side of Transportation for deferring to us so these lovely witnesses would have an opportunity to make their flights.

With that being said, thank you, Madam Chair and Members of this Transportation Committee for allowing me to be here to present SB 800 on behalf of Senator Reyes.

SB 800 is a district bill that requires Caltrans in consultation with effective local governments, to assess and determine appropriate mitigation measures to help prevent suicides on locally owned overpasses that cross over state highways.

While any suicide attempt is a cause for alarm, there was an especially heartbreaking scenario in Senator Reyes' district last year where her community lost two high school students at the same time, same location, within a week and a half of each other. I would. You know, my respect for Senator Reyes is very high.

However, only one thing I would challenge her and say, this really isn't a district bill. It's a state bill. When I was in high school, I had a friend of mine. Her name was Gabrielle Wong. And she always got straight A's and I got straight Bs.

I got Bs because my mom said I had to have at least a B average to play sports. So I got B's, but Gabrielle always got A's. And she went to UCLA her freshman year, and for the first time in her life, she got a C on a midterm. And how did she respond? She dropped.

She actually climbed over and, you know, went to, unfortunately, her death on the 110 freeway. Young people oftentimes unfortunately see this as when there seems not to be hope, not understanding the very severity and the harm that this will cause.

Since Senator Reyes, in her district, like mine, had these losses, there have been other attempts on similar overpasses which speak to the necessity for the state to properly plan mitigation measures. As these are not isolated incidences. Addressing suicide is inherently complicated, and there is no single answer to how to prevent these tragedies.

However, having this important infrastructure is a critical step in the right direction. Senator Reyes and Assembly Member Garcia's offices have been in communications with Caltrans on this issue and are committed to working with them to see this issue resolved. No family, no school, no community should have to endure such unimaginable grief.

Here to testify in support of SB 800 is Lynn Kennedy, Mayor Pro Tem of the City of Rancho Cucamonga.

Thank you, Senator Richardson, and thank you, Members and Chair, for giving me an opportunity today to speak on this very important issue. As was mentioned, this bill has shifted slightly away from its original intent. We sincerely thank Senator Richardson as well as Senator Reyes and her staff and this Committee for keeping this issue visible.

The continued visibility is deeply important to our community and was mentioned by the Senator by this entire state. Just last week, unfortunately, we experienced another suicide attempt on one of our freeway overpasses. These incidents, as mentioned, are not isolated. They are ongoing. They are devastating. But what's most important is they are preventable.

We understand the cost constraints and operational challenges Caltrans faces, but there is a difference between price and cost. Price is quantitative, it's fixed. The cost is qualitative, and it's devastating. SB 800 is a step in the right direction.

It's a vehicle for conversation, a tool for identifying high risk locations, and ultimately a path toward real life saving change. But for this study to be meaningful, it must drive action. Identifying overpasses with a history of of suicide or suicide attempts, determining where structural safety interventions are most urgently needed, and ensuring that those improvements are implemented.

This isn't just about data collection. It's about prevention. It's about putting safeguards in place to prevent future tragedies. Thank you again for your leadership and focusing on this issue and continuing your support for suicide prevention throughout the state. Rancho Cucamonga remains committed and we will work along with our partners, Caltrans, as well as forums. Thank you again.

Did you want to?

Good afternoon, Chair and Members. Dean Hutchings here representing the city. Just simply here to answer any technical questions if they arise.

Thank you. All right, moving on to members of the public who would like to add on their support. Name, affiliation, and position.

Leah Barrows on behalf of California Hospital Association, in support.

Nicole Moroles on behalf of Children Now, in support.

Hannah Hunter at Seaside Advocacy on behalf of San Bernardino County Transportation Authority, in support.

Hope Velarde with Healthy Rancho Cucamonga, in support.

Andrew Antwih on behalf of the California State Association of Psychiatrists, in support.

Claire Sullivan on behalf of the California Association of Psychiatric Technicians, in support. Thank you.

Good afternoon. Alejandro Solis on behalf of La Cooperativa Campesina California and Los Amigos, in support. Thank you.

All right, thank you. Moving on to opposition. We don't have any registered opposition, but I did want to give an opportunity for any member of the public here who would like to note their opposition to please come to the mic and give name, affiliation and position. Seeing none.

Now moving back to Members of the Committee, we'll start with Papan.

Oh, I just want to say, had it happen in my district. I'd be pleased to move the bill. Thank you for your efforts.

Motion made. Lackey?

Yeah, I just want to commend the author for addressing this issue in somewhat of a meaningful way. I don't think anybody can match the horrendous experience I've had relating to this issue. And I've responded to multiple incidents where this has taken place as a Highway Patrol Member, and I witnessed one, and it's a memory that pretty nasty.

And it happened during the holiday period and it was a person in their young 20s. And every Christmas season I'm reminded of this. And so if we could do anything to prevent such a malady, it's worth trying. Thank you.

Thank you. Is there a second for the motion made? Second by Jackson, and then Davies.

Real quick, I just want to say thank you so much for bringing this forward and I'd like to be considered for a coauthor.

All right. Seeing no further. You know, studies have found that restricting access to lethal means such as high places like bridges is a critical strategy for suicide prevention. And suicidal crises are often brief, with the time between thought and action sometimes lasting only minutes. And so implementing safety measures introduce a crucial pause offering time for intervention.

And this study will help to identify appropriate suicide deterrent measures for locally owned overpasses over state highways in the state's right of way. I appreciate you, Madam Mayor Pro Tem, for coming to advocate on behalf of your community and as a result, the state. And so I will be supporting this bill today. So I'll give the the Senator an opportunity to close before we take roll.

On behalf of Senator Reyes, Assembly Member Garcia, and the Mayor of Rent, Mayor Pro Tem, of Rancho Cucamonga, we thank you for your time, for your consideration and understanding that this is something we can work on and we can do better. Thank you for your comments, and we look forward to implementing the bill. And we respectfully ask for your aye vote.

Thank you. Madam Secretary.

[ROLL CALL]

There are 10 aye votes, and we'll hold the roll open for Members to add on. All right, now, moving back to file item order, we will go with item number one, followed by item number two. SB 30. Starting with SB 30. To the Senator at your convenience.

Thank you, Madam Chair and Members of the Committee. I want to start by accepting the Committee's proposed amendments and also I want to thank the Chair and the Committee staff for working with me and with my office pretty intensely on this bill to get it right, which is, you know, I think, kind of become a vanguard of this Committee.

So thank you for all that work that you've done. As amended, SB 30 prevents California public entities from selling, donating or transferring decommissioned diesel locomotives, meaning already decommissioned diesel locomotives and railroad equipment with a tier one or older engine unless the engine is removed. These are the oldest and most polluting engines.

This bill permits the sale or transfer of tier 2 and newer engines if the transferring agency approves the transfer by voting at a public hearing. The devastating health impacts of diesel pollution cannot be overstated. The International Agency for Research on Cancer has classified diesel emissions as carcinogenic.

This is because they contain more than 40 chemicals known to cause cancer, including benzene, arsenic, formaldehyde, and lead. Exposure to these chemicals can lead to increased hospitalizations, worsening health conditions, and premature mortality. These chemicals make diesel exhaust more damaging to human health than gasoline vehicle emissions.

An article from the National Institute of Health Points to 115,000 deaths caused by gasoline emissions and and an even greater 122,000 deaths caused by diesel emissions. These diesel related deaths can be attributed mainly to soot and smog exposure. According to the California Air Resources Board, diesel particulate matter can travel hundreds of miles once emitted.

This means it can influence air quality far from the source of pollution, including in California. Caltrain recently agreed to send its retired fleet of 90 cars and 19 tier 0 diesel locomotives to Peru, tier 0 being the dirtiest of locomotives. Tier 0 engines were manufactured before 2002 and do not have to meet EPA emission standards.

Caltrain points to a U.S. state Department analysis that projects emission reductions from this transfer. But these tier 0 engines will continue emitting hazardous particulate matter and GHGs. In Peru, the cost to electrify that line was $2.5 billion. The retired tier 0 fleet was sold for $6 million.

This recovered 0.24% of the cost was 1/4 of 1% worth it to expose new communities to hazardous pollutants. One of the selling points of this change in the Bay Area was that children would no longer be exposed to diesel emissions along the corridor. That should have been punctuated with a comma that said, except in Peru.

From the project's inception, Caltrain has been highlighting the GHG reductions from getting rid of the old dirty tier 0 diesel engines. In a 2016 news release, it projected that regional air quality would improve by 97% and that it would reduce 176,000 metric tons of CO2 equivalent by 2040.

If the switch from tier 0 to fully electric reduces at least 176,000 metric tons of CO2, how can we then go and send these very same metric tons of CO2 somewhere else?

In a 2022 news release celebrating $10 million in federal funding to the project, Caltrain stated it would eliminate the particular matter, quote unquote caused by these engines. Eliminate, yet the trains will continue polluting.

Though the bill allows for the transfer of tier 2 and higher engines under some circumstances, I still want to highlight the importance of thinking long term. When jurisdictions begin to build out the rail transit infrastructure to acknowledging to take automobiles off the road, typically there is an opportunity to start cleaner.

If they begin by investing in diesel locomotives and infrastructure, then any future investment in lower emission or zero emission locomotives and infrastructure is likely to have to come much, much later, closer to the end of their useful lives and additional expense. We all know the climate crisis is now and we need to reduce diesel emissions now.

SB 30 aims to reduce the ongoing harm caused by emissions from California's diesel engines once we replace them with cleaner engines. This bill is the support of many environmental organizations that believe in a diesel free future.

With us today to testify in support is Jonathan Cole with Climate Action California and at the appropriate time, I'd respectfully ask for your aye vote.

Good afternoon, Chair Wilson and Members of the Committee. My name is Jonathan Cole. I'm with Climate Action California, a grassroots legislative advocacy group focused on science based solutions to climate change.

As a Professor of Physics at MiraCosta College in San Diego County, now Emeritus, I've participated in climate research as a visiting scholar at the Scripps Institution of Oceanography and coauthored two chapters of a University of California climate textbook focused on climate change solutions, including black carbon and other climate super pollutants.

In addition to their emissions of carbon dioxide and a range of pollutants, diesel engines are a major source of black carbon, a potent warming agent. These tiny dark particles absorb sunlight and re emit that energy heating the Earth's surface. When they land on snow or ice, they speed up melting. Black carbon particulates also damage human health.

These tiny particles, less than 1/30 of the diameter of a human hair, penetrate deep into the lungs, causing respiratory disease, cardiovascular disease, and lung cancer. It's estimated that eliminating black carbon globally would prevent about 600,000 to 4.9 million deaths each year.

Black carbon particles only stay in the atmosphere for a few weeks, however, so cutting diesel emissions provides rapid benefits for both the climate and human health.

Climate Action California believes that the transfer of decommissioned tier 2 and newer diesel locomotives should not be allowed unless a net reduction in greenhouse gas emissions and an air quality benefit can be shown. However, that provision has been removed from the bill.

Still, by prohibiting the transfer of the most heavily polluting tier 0 and tier 1 locomotive engines and SB 30 still takes an important step in the right direction. California should be a world leader in demonstrating climate solutions and preventing older polluting diesel engines from continuing to worsen climate change and damage human health in other regions, especially in developing countries.

I respectfully ask for your support for SB 30 to ensure that California's most polluting decommissioned diesel locomotives stay decommissioned. Thank you.

Thank you. Now moving on. Members of the public who would like to register support or add on their support, please come to the mic. Name, affiliation, and position.

Good afternoon, Jakob Evans with Sierra California, in support. Thank you.

Thank you. Now moving on to opposition. We do have registered opposition, so as a reminder, you have two minutes for testimony.

Good afternoon, Madam Chair and Members. Brendan Repicky with the California Transit Association, representing public transit and rail agencies statewide. Madam Chair, we do appreciate and thank you for the Committee amendments. We do still have concerns with the bill.

Fundamentally, we share the goal of the author and sponsors, and our rail agencies have worked to upgrade their fleets so that on average they are just about the cleanest in the country. As the Committee analysis notes, this bill targets a very small slice of locomotives.

There's just about 20 tier 0 and tier 1 in passenger service, but these locomotives play a very important role in existing passenger rail service and in actually benefiting the public by keeping hundreds of thousands of cars off the road.

There's such a rail shortage nationwide that other agencies would be very interested in acquiring these if they were ever available to fill gaps in their own service. For instance, Caltrans would like to lease or purchase some of Caltrain's locomotives, which would be prohibited by this bill.

And I'll just note regarding the author's comments regarding Caltrans transfer of train sets to Peru. That was done as a donation in concert with President Biden's State Department last fall. And the Committee analysis notes that this will shift 150 to 250,000 daily passengers daily passengers off of buses and cars in Lima.

So the Department of Transportation, the Bay Area Air Quality Management District both certified that this would have a huge air quality benefit to the Folks in Peru. We've requested an amendment that for agencies that want to transfer or sell or donate tier 0 or tier 1 locomotive, they should undertake an air quality assessment.

If that assessment demonstrates that there will be an environmental benefit to the transfer because it results in fewer cars on the road or increased ridership, then we think it makes obvious sense to permit that transfer on a case by case basis. Thank you.

Thank you. Now moving on to members of the public who would like to add on their opposition. Now would be the appropriate time to come to the microphone and note your name, affiliation, and position. Seeing none. Bringing it back to Committee for questions, comments, and/or concerns. Seeing none. I'll just note.

Thank you to the Senator for bringing this forward. And as you noted, we had a lot of robust discussion back and forth trying to find the right balance on this bill. I appreciate you and your team working with our Committee staff on the amendments.

We know the transit agencies across this nation are struggling financially since the pandemic. And here in California, it's no different. Selling locomotives they are no longer using can provide additional revenue.

And as our public transit agencies continue making strides towards cleaning up their older dirty engines, it is important to consider that some of these older engines can be valuable to other agencies. The language surrounding tier 0 and tier 1 specifically relates to locomotives of a particular age.

And that's why it's important that we had the amendment that emission equivalent because they can never change their name basically or title by age, but they can have different enhancements that make them lower emitting vehicles. So we wanted to make sure that wasn't capper.

So I'm so glad that you took that amendment given all the work that we've done on this. I will be supporting your bill today. I want to see if there's. We'll entertain a motion or second and then give you an opportunity to close once we do so.

All right, we have a motion by my good friend Rogers and seconded by Jackson. To the Senator, opportunity.

I'm not your friend. What's going on here?

I'm sorry. My other good friend.

Oh, okay. I'm just checking. I thought our relationship changed or something.

All good friends. I appreciate the work of this Committee and every single Member bipartisanship is reigned supreme in our Committee and all of you are my good friends. And with that I'll give an opportunity for my other good friend, the good Senator from San Jose to close.

Well, thank you, Madam Chair. The feeling is mutual. I'm glad we can work through these issues as we do and remain very cordial and very much friends going forward working on policy here in the State of California. The only clarification I would make, you know, is not to miss the point here based on opposition comments.

This bill does not take existing trains that public agencies are using now. The opposition talked about approximately 20, off the tracks. If they take them off the tracks, if they do it because they want to replace them with clean vehicles, then this bill kicks in and starts talking about what limitations there should be on transfer.

It's a really important distinction, I think, because this isn't a bill that's forcing anybody's equipment off the tracks. That becomes their decision.

I do want to acknowledge, and then I'll respectfully ask for your aye vote that my colleague, Senator Blakespear, who as something we created in the Senate transportation area, Chairs the Subcommitee on Lausanne, also happens to chair the EQ Committee in the Senate and worked with us very, very closely to make sure that the amendments taken there were designed to not impact projects here in California that might at some point need to take advantage of a transfer.

And I just want to acknowledge that because I know that as we get, as we're moving back and forth between both houses, there are more than just Senator Blakespear that represent areas like that and and projects like that. So with that, I would respectfully ask for your aye vote and thank you again.

Thank you. Madam Secretary, please call the roll.

[ROLL CALL]

That Bill has six aye votes, four no votes. And we'll hold the roll open for Members to be able to add on.

Is it appropriate to ask now before we move on for reconsideration in the event that the vote doesn't get out of Committee today?

Absolutely. And we'll. Yes.

Thank you.

You're welcome. All right, moving on to item number two, SB 791.

All right, thank you again, Chair and Members of the Committee. SB791 modernizes the non governmental document processing charge, or DPC for short. That is a document charge that vehicle dealerships are authorized to collect during a car sale or lease.

I want to note that I will be accepting the Committee's amendments and want to thank the chair of Committee staff once again for working so closely with us on this Bill. SB791 replaces the outdated flat cap of the DBC of $85 with a new percentage based structure. 1% of the vehicle price capped at a maximum of $350.

And I want to emphasize that we can deal with that if there's question and answers later as well. But there's been as usual, some fake news out there that we are have been pitching a flat cap which would have been the maximum that the Bill allowed. That's not the case.

This is a percentage based charge document charge with a cap on it. But again, we can answer questions on that later as need be.

Under this Bill, as amended by the chair, a dealer must now disclose the charge to the consumer at the time the vehicle is advertised and several times before the customer signs a final contract, including by way of posted signage at the dealership.

So this Bill is necessary because California's DPC is currently the lowest in the nation, about one fifth the national average. Even though our state imposes the most stringent document processing and consumer protection obligations on dealers than any other state in the country. When it was established, it wasn't indexed.

It was established as a, as a flat charge that has been falling further and further behind for years and years now. At a fundamental level, this Bill simply seeks to allow critical California businesses, ones that greatly contribute to our local and state economies, to recover the cost of doing business. A 2019 J.D.

power study found that the average cost for dealers to provide these Services nationwide is $447 per transaction. Dealers perform a wide range of services that would otherwise fall on consumers. It's not just vehicle registration and loan processing or contract translation and fraud prevention.

As a matter of fact, there are 13 pages now on spreadsheets that we have available if anyone would like to see them. With 113 documents, all of them created by the Legislature, all of them statutorily required.

That's a lot of growth since the original or since the $80 fee and the $85 fee were approved as a flat fee some time ago. Without that work, without that service of somebody sitting there dealing with all those documents and going down that checklist.

These buyers, all buyers would need not just to manage, not just to visit DMV, but the very statutes we put in place about catalytic converters. And a number of things wouldn't get dealt with, they wouldn't get implemented.

SB791 ensures dealerships can recover real costs while maintaining transparency with me Today is Anthony Sampson representing the California New Car Dealers Association and at the appropriate time I'd respectfully ask for your aye vote. Thank you.

Before we start testimony just noting that the amendments were made prior to Committee. I'm in crossed by the author. And so for the Members of the Committee it is just a do pass. But the comments reflect that the Senator noted as a part of his introduction or opening include changes that were made prior to this.

I mean that he made post his last Committee in consultation with our Committee but prior to this Committee. So it will be just a do pass at the appropriate time.

Very correctly stated and and thank you for that long length of time of work to give us the time to make authors amendments. Thank you.

Thank you. Now to the witness. Two minutes.

Right. Thank you. Madam Chair Members, Anthony Sampson here on behalf of the California New Car Dealers Association. First I'd like to thank the chair and the Committee staff for the constructive discussions that we've had to date and the work they've put in on this measure.

I'd like to start by noting that nearly all businesses, ranging from restaurants to title companies to other businesses, recover their costs simply by imposing various line item charges and fees that go by different names.

But what's unique in the context of auto dealership is that for several decades auto dealerships have had to come to the Legislature to get approval to recover their costs.

Specifically, California and many other states have designated the document processing charge, a statutorily capped charge, as the mechanism through which dealerships can collect the costs associated with all the services dealers perform during the sales and lease transaction process. The opposition has stated that the DPC increases have historically been accompanied by new dealership obligations.

Notably, that argument fails to acknowledge that the fact that this Legislature introduces and passes bills placing significant new obligations on dealers year after year. But those measures do not contain corresponding DPC increases.

In fact, this year we have spent countless hours on a measure sponsored by the groups that are making this argument that would represent the single most significant overhaul of the vehicle sales transaction process ever in California. But there is no corresponding DP DPC increase attached to that measure.

Second, the opposition argues that consumers are not made aware of the DPC until late in the transaction process. That is not true today given the charges disclosed in the pre contract disclosure. But regardless, through discussions with the chair and as the Senator pointed out, we have agreed to add multiple new disclosures including when the price is advertised.

And finally, the opposition argues that dealers should recover their costs in the price of the vehicle. A couple things on that apart from the important fact that this is how the law has been structured for decades and each time the charge has been increased, the Legislature has endorsed treating this as a separate line item charge.

First, the argument applies that there is an acknowledgment that dealers, like other businesses, should be able to collect their costs. Yep.

Assuming we're in agreement on that point, then the question is why, as a policy matter, would we bury those prices into the price of the vehicle rather than as a separate line item and transparent charge that is consistent both for consumers and dealers?

And with that in mind, in closing, our position, as the Senator noted, is that the charge simply has not kept pace with the obligations dealers have taken on in California. We appreciate your support in helping us resolve that and respectfully ask for your.

I vote Members of the public who would like to add on their support, name, affiliation and position.

Kenton Sandop with the California New Car Dealers, but also here representing the San Diego New Car Dealers Association, the Orange County Auto Dealers Association, the Greater Los Angeles New Car Dealers Association, the Silicon Valley Auto Dealers Association, all in strong support. Thank you. Cody Boyles on behalf of CarMax and support.

John Moffitt on behalf of Enterprise Mobility and Support.

Believe it or not, this affects motorcycle dealers. James Lombardo Sr. On behalf of the California Motorcycle Dealers Association.

Thank you. Now moving on to opposition. We do have registered opposition, so give an opportunity for opposition to come. As the testimony went a little bit longer, you'll be given 2 minutes and 15 seconds.

RA.

Madam Chair and Members, Rosemary Shahan testifying on behalf of Consumers for Auto Reliability and Safety, as well as the California Low Income Consumer Coalition and Consumer Reports. We appreciate the amendment lowering the cap from $500 to 350.

However, we feel that the increase is unjustified and it's not low enough considering the fact that dealers actually make a lot of profit from handling the documents. For instance, when it comes to auto loans, that's actually a major profit Center for dealers.

And there's also another part of the Bill in the analysis that mentions that dealers say that they should be compensated for handling trade ins. That's another major profit Center for dealers. And we see this as a one sided benefit for dealers at the expense of California consumers when we should be focusing on making cars more affordable.

And note that in the analysis, according to J.D. Power and Associates, they recommended consumers that they shouldn't pay more than $150 for the document fee. And in Texas, where dealers have to actually provide a basis if they want a document fee increase, that's proven in an administrative court, Texas increased their document fee to $225 to substantially less.

And we're concerned that this is going to benefit multibillion dollar corporations, including Tesla, at the expense of California consumers. And respectfully request your no vote.

Good afternoon. My name is Richard Holliber. I'm the President of the Consumer Federation of California and also an officer in the California Alliance for Retired Americans. Both organizations are registered in OPPOS and I'm here to represent them.

And I really just wanted to give you a personal story about what I went through when I purchased a new car several years ago at a major franchise car dealer in Burlingame, California. I had done my homework.

I had a pretty good sense of what the actual costs were to the dealer and I was shopping around, so I went to the dealer saying, you know, I'm going to be buying a car today. It might be from you, it might be from one or two other folks down the block.

I like your car, I like the other cars. I'm here to get the best deal. So if we can agree on a price, I will pay that price, I will pay tax and I will pay title. I don't want any other add ons.

I don't want you to hit me for extended warranties, for undercoating, for anti theft etching, or for document preparation fees. Once we agree on the price, that's the price. Well, eventually with the sales manager got involved, we reached an agreement on a price.

I actually Walked off a lot at 1.0 and he came running after me saying, come back. I went back, I'll give you the price. And I said, okay. And no, no last minute add on fees, the price, the tax and the title to register it.

Of course, when I got the invoice, it included the $80 document preparation fee. And I said, I thought we were dealing honestly here. I told you the price, I told you my conditions, and now you're trying to hit me. You know, I'm at the goal line here. I'm about to buy this car.

And first thing he said was we're required to charge it. It's a mandated fee. I said, well, let me tell you who I am. I was the Executive Director of the consumer Federation before I retired and I had worked on this legislation in the past. And I said, actually it's a cap. You don't have to charge anything.

You're not permitted to charge any more than that cap. And I don't want to pay that fee. He then said, I have to wrap up. Okay. He then said, if I change it for you, I have to change it for everyone. I said, no, you don't.

Finally, as I was ready to walk out, I said, fine, I, I will reduce the price by $80 for the invoice and I'll recapture it. $80 with the DOC fee. Your price is the same. I'm a highly educated consumer advocate. Think about what other people go through.

This is the last step before they get that dreamed of car.

Thank you.

Thank you very much.

Yes, and someone may ask your question to finish the story. With that. Moving on to Members of the public who are in opposition, now would be an appropriate time to come forward and note your opposition. Once again, that is name, affiliation and position, seeing none.

Moving back to Members of the Committee to give their comments, questions and concerns. Jackson.

Thank you. This is questions to the sponsor of the, of the Bill. I mean, obviously this Bill allows you sets another a new cap in terms of what they're able to charge. However, that still doesn't mean the customer cannot engage in negotiations over that fee. Am I correct in that.

Through the chair? Yes, that is correct. It is a negotiable charge. I will say I want to just. I think your question dovetails nicely to the story that we just heard, which is an unfortunate one. And I will tell you that today, if a dealer were to say to a consumer, this, there's my hands are tied.

This is required by the government. Nothing I can do that is illegal. That is an illegal representation for which there ought to be a claim.

We've had this discussion with the chair and working through the amendments and the chair to her credit, wanted to make sure that we made it very clear that this is a dealer document charge that the dealer collects and not the government, which will be further disclosed in the pre contract disclosure.

But to your question, you are, you are correct. It is a capped fee. It is not a mandatory fee.

And then the level of fee is also associated with, based upon the price of the vehicle.

That is correct. We wanted to make sure that. One of the criticisms, not only in California, but in other states is the fact that it's regressive in nature. Somebody purchasing a Honda Civic, for example, was going to pay the same amount as somebody purchasing a Ferrari Testarossa. Right.

We wanted to make sure that we did a percentage charge to ensure that those purchasing a, a lesser expensive vehicle, say it was a $20,000 vehicle, that would be 200. Whereas if you go up, you ultimately hit that cap and anything beyond that stays at that cap.

But this was a, an effort to try to make it a little bit more progressive in terms of the structure of the charge.

What would be the, according to this Bill, what would be the lowest fee associated based upon a car price?

I suppose, suppose $0.01 if you bought a $1 car. But I mean, it would, this is California. Don't, don't lie. You know, it's a great question. I mean, you know, let's just say a $10,000 vehicle, it's a $100 charge. I mean an $8,000 vehicle would be an $80 charge.

So it's, it depends on what the lowest cost of a vehicle is.

Got it. I think. Lastly, Madam Chair, I know you engaged with the author in terms of ensuring that consumers can see that up front. As part. I know this Legislature has done a lot of work on mystery fees and all those type of things. Surprise fees at the end of the day. And so how does that work?

Does that mean that when I see that sticker on the car, it'll also have the price of what the application fee would be or at what point will the consumer be able to see that price?

Yeah, it's a good, it's a good question. So it's in the advertised price of the vehicle. So if you go online, right.

And you search for a vehicle and it says a $50,000 vehicle, today there is a disclosure that is required and it's required to say, you know, this, you know, exclusive of taxes fees and a dealer document processing charge. Again, in discussions with the chair, I think the chair had expressed concerns that you can't that sure.

A dealer document processing charge, that doesn't mean much to very many people because they don't know what the cost, what that is.

And so what would be now required under the amendments that are in print is that it would say not to exceed $350, knowing that going into the dealership you're going to be, you know, the charge will be at a Max 350, but certainly perhaps below that depending on the price of the vehicle.

Okay, thank you, Madam Chair.

And just to be clear, it also does it in the cubicle, the sales. Right. And as well as in the pre contract written. So there's three opportunities to see this not to exceed $350 charge prior to ever negotiating the price, correct?

That's correct. It would be in multiple locations. Thank you.

Thank you. And I think on one of your comments, I want to give a chance I think on one of your questions, opposition wanted to testify. I thought I saw Ms. Shahan, did you want to say something? I want to give you an opportunity to say something.

Thank you, Madam Chair. And so your question, sir, Assemblymember, about whether it's negotiable. I think theoretically it is. But as a practical matter, it ends up consumers are going to pay 350.

You know, it's a rare occasion when people at the usually at the end of the transaction when they've been spending often hours shopping for a car that they're going to say, you know, I'm negotiating this.

And what we've heard from consumers, not only in California but in other states, when they question it, they're often told, I can't charge you a different amount because that would be discriminatory. Everyone has to be charged the same amount. And consumers aren't in a position to say, no, I'm overriding that.

All right. Is there any other comments, Lowenthal?

Yeah, I have a couple questions for the proponents, actually. First question I have to ask is, Mr. Sampson, what fees are restaurants charging to recover costs that you're referring to?

So I can so long as we're providing some stories of our own experiences. My well, right down the street, you sit down and look at that menu at the bottom, it says that there will be, I don't know what the percentage is, an X Percent service charge. You know, there are different charges.

They're calling it different things depending on the type of business, but they are adjusting based on that.

That's a good analogy. At all that's a way to distribute services for workers, actually that doesn't go to the restaurant.

I think what you're talking about is recovering costs of actually, you know, some administrative fee, which I think is vastly different than the way tips are actually handled between the front of the house and the back of the house.

And a lot of places have moved to administrative fees so that the back of the house can enjoy what the front of the house currently enjoys. So without getting into that, I just don't think that that's a good. From somebody in the restaurant industry. That's a good analogy.

Having said that, I fundamentally agree that there should be fairness across states when it comes to this. So I don't begrudge the impetus for this Bill. What I'm truly troubled by, and we've had conversation, direct conversation earlier today and with Mr. Stanhope earlier is the timing of this.

It is a very difficult time for consumers in the State of California. We have affordability crisis. That is an awful position. And I really want to be supportive of this Bill and be supportive of new car dealers.

And as I asked you outside and I would like to ask for the benefit of the Members of this Committee and to the General public, would you consider tying increases to economic index indices that where consumers can better withstand such a jump at any given time would have the ability to do so in concert with how the economy is doing?

Yeah. And thank you for the question, Assemblymember, and appreciate the discussions that we've, we've had. I will tell you it's, it's funny. It sounds like a simple issue. It's sort of changing a number to a different number at adding a percent. There are multiple different ways that this issue can be approached.

Remindful of the comments that you raise. And so to that end, what I would tell you is, you know, while we look at the amount of time left in the session, it doesn't appear that there's much but in legislative speak there, there's quite a lot of time to have these discussions.

As I committed to you before and I would commit to you now, we are, we understand that there may be multiple ways to address this. You would talked about phased in what have you. And we are, we are more than open to having those discussions moving forward. There is no perfect way to address an issue like this.

And so I would just note we don't want to get into negotiating on in the Committee because we have talked about this in two different committees. This price and how we achieve this.

And so it would have to come back if there were further negotiations around the top part and I do understand the concern of affordability that's top of mind. And tying to some kind of economic indicator.

Part of an economic indicator is the actual price of the vehicle and what the market would bear based on what is happening at any particular given moment through supply and demand.

So just noting that because it is a flexible dollar amount now versus a flat fee and someone buying a $10,000 car would not be far off from this amount. But I just wanted to keep that in mind as we continue in the legislative process in order to achieve a successful pathway to the governor's desk.

Of course more conversations with happening but we have had a couple of committees weigh in on the amount.

I can only speak for myself and speaking for myself, I would only want to support this Bill under the commitment that you just made.

And I'm as to the to the hold on, hold on. To a Member of my Committee, I would just like to note as chair I've spoken about this amount and we will not be negotiating this particular amount during Committee.

If you are interested in not supporting this today or not supporting on the floor related to that, that is fine to have those negotiations but I have spoken as chair that those further negotiations would bring this back to my Committee and making it very clear if you have further comments that you would like to give, you can do those.

Otherwise we do have two other Members who have asked to speak. I'm not sure if any on that's on this my left side have so all right with that. I'll move it over to Rogers and then Hart.

Thank you, Chair. So one of my questions was directly related to what my colleague was asking, but I'll shelve that for the moment.

One of the issues that was discussed in one of the letters that the Committee received was that in addition, while you do have a line item for cost recovery for the document fee, you also have other areas where perhaps the total staff costs or the cost of doing business can be recouped.

One in particular was it says kickbacks for lenders in exchange for assigning loans. And I'm hoping you can give me a little bit of information. One, is that disclosed? Two, how much money are we actually talking about? That is typical.

And three, does that not cover even if you're not calling it the document fee but covering the cost of doing business for folks. And I'll ask both the support and the opposition.

Let me start off by saying there's what you're referring to is the sale of a Conditional sales contract, which is governed by federal law, the RE Levering act, and it's not being taken up or modified anywhere in this Bill in terms of all the disclosures that have to be made about all of that.

When as somebody who was a banker and purchase a lot of conditional sales contracts from new and used car dealers, those, those relationships vary from contract to contract depending on the interest rate on the contract, depending on the, the buyer's qualifications in the first place, their, their credit qualifications and, and depending on the lender and the type of lender, an FDIC insured bank is going to have a different relationship with, with the, with, with the dealer than someone who's not.

So there's not a set number that, for example, we could disclose in this Bill per se.

But you know, if we start, I think if we start going down the checklist of, you know, each and every way that a dealer is able to, you know, sustain itself or make some money, depending on whether they're a small used car dealer or, you know, a very large new car dealer, ranging from service and service agreements and other things, it would be beyond the scope of this Bill.

Thank you very much for your question. Assemblymember car dealers make a tremendous amount of profits by selling loans to lenders. And it's called like the dealer markup, dealer Reserve, dealer participation. It does vary. That is true.

There have been studies done by the consumers who are responsible lending finding that Californians pay billions of dollars every year in dealer participation, dealer Reserve that's added on and it's typically not disclosed.

Can I add my own experience again? You know, buying a car is the most opaque consumer transaction that exists. There's nothing like it. People are totally befuddled by it.

Same day I was telling you about when I went to this dealer, I went to another dealer and you know, you're in the cubicle and the salesperson is saying, well, I'm your advocate. I will go talk to the sales manager.

I told him the price, they're going to make a modest profit and they'd be, I'd be in and out of there in a few minutes. He comes back, he says, I talked to my sales manager. We will agree to that price if you finance the car through us. Otherwise it's going to be $1500 more.

Now this was several years ago, so right there you're getting an idea of the profit they're making off of dealer arranged financing. And I know one of the items they mentioned in the documentation fee request to increase it are those costs they are recouping those costs because they're placing loans with lenders.

Generally, they're the worst loans you can get. If you're smart, you shop the loan and you don't get it through the dealer. And now they want to double dip by saying, well, gee, we want to recoup that cost. They're already making, in my case, $1,500. And this was several years ago. It's probably more like $2,000 today.

Please.

I will just say we agreed to an amendment after discussions in the Senate that we often called the double dipping amendment. It is illegal now under this Bill to seek to recoup the costs of the sales and lease transaction process through any other mechanism other than the document processing charge. This. This Bill relates to that process.

And how would a consumer prove that? How. How would a consumer prove that the General Markup, which is different for every retailer, does not include an additional potential Markup related to this? That's why what I'm trying to get at in my questions is to parse out, are we increasing the document fee because we can.

On consumers, because we can justify it, but as my colleague noted, at a time where consumers are really struggling, or are we increasing the document fee to recover costs because dealers are just right on the edge of having to close their doors and every little bit is going to matter.

And how would we know it would be the latter? That every little bit matters? And I will just tell you that while we often hear about narratives about dealer, you know, billion. You hear the word billion. Billion. Billion. I will just tell you this.

The client I represent, the California new car dealers Association, has 1200 new car dealers throughout the state. If we suggest here that somehow all of those entities are doing so great right now, that would be flat out false. It is a struggle to do business in the State of California, regardless of what business you have.

Now, I'm not suggesting that we have to come to the Legislature to save us, but what I am saying is the dealers have not been recovering their costs for many, many years. And that is well documented, given the charge has been stuck at the lowest level in the nation for many years, despite having the most obligations.

And so we are here asking for a fair shake, and that is it. From there, if the dealers are struggling, if there are. There are single source, you know, shops that are struggling, then they're struggling, you know, and that would be unfortunate.

But the fact of the matter is, if we're all in agreement that it is fundamental to be able to recover your cost of doing business, this is the way we have to do it. Otherwise we wouldn't be here today.

I can appreciate it. What, what I am concerned about is feeling like we are nickel and diming consumers, as was mentioned. We can't discuss a phase in, but I'd be interested in talking to you about that after the fact. We'll see where we go from here. Thank you.

All right.

All right. I think Assemblymember Hart has declined to speak. Is there any others before we move on? Okay. First of all, thank you to the Senator for working with my Committee on amendments to increase transparency around the document fee.

It's been nearly a decade since California last raised the fee, and I do believe it's important to dealerships to be able to recoup their costs during transactions. I noted that my last vehicle purchase, the last two, happened to be cash and the same amount of paperwork.

I was really excited to finally come into a dealership and pay cash for a vehicle versus a loan. And I noted that I did the same exact paperwork to be able to pay cash. So it was the same process. And it was frustrating because I thought I was going to save some time. And we did not.

And so the amendments that we worked on, which were taken by your office, consumers will be aware of the maximum amount that they could be charged for a document fee. It will be clearly disclosed to the consumer several times prior to purchase that this document fee has a not to exceed amount. So therefore up to.

And it's also not a government fee. And so with that, I will be supporting your Bill today. I'll give you an opportunity to close. I think we. Or no, we didn't, did we? All right, I will entertain. I want to entertain a motion. Been. Moved by Aguiar Curry and seconded by Macedo. Senator, please.

Thank you, Madam Chair. Again, all that work that you just outlined is very much appreciated. Let me. I do want to speak very briefly and quickly to some of the important Member comments because I do appreciate the robust discussion.

And we've been, I think anytime you've had a lot of robust discussions on a Bill, you appreciate it when you get to Committee. And there's more of that because it makes you feel like people are engaged and this really means something.

We've had a lot of conversations, I have, starting from day one with, with the sponsors about indexing, mainly because if you look back, as chair said, 10 years to see the last increase, which was five bucks, you got to go a long way back to see when the $80 came in years and years and years before that, and it occurs occurred to me just as a business Proposition and a policy Proposition that had they indexed it to cost of living index per region at that time, we probably wouldn't be here today at all.

I think that's part of what my sponsor was trying to say in earlier Q A. We wouldn't be here if that was the case. But we're stuck. We've been stuck with this flat fee scenario where you have to come back. There's never going to be a great time to do that.

This is a time when people are trying to put a half cent sales tax on the same consumers I represent in the Bay Area for transportation purposes. And supposedly that's not a problem. In terms, in terms of affordability.

This, this I think always has had room, not today because the chair helped us structure a great framework, but has always had room for indexing again in one value to that would be making sure we don't ever have to come back again and have this kind of a discussion.

The problem is dealers and the sponsors here and the committees that have worked on this have basically come up with a scenario which says let's just cap it because that's what's fair and use a percentage instead to achieve in effect what we would with a COLA as.

As the price of vehicles changes, the price of purchases change the 1% tracks. That for example, that $8,500 car, the $8,000 car is actually less under this Bill as on a document fee than it would have been before the Bill.

So, you know, we've tried to create a mechanism so you gain something by indexing, you lose something by indexing. Because with indexing, presumably the 350 would just keep going up and up and who knows when it would ever be reviewed by the Legislature.

So we feel like we've done a good job, a great job just to get this framework and this model here. But I want to say as an author, I'm more than happy to continue the discussions about whether there's something about indexing all or part of this that makes some sense down the road.

And if you do that, you will be returning to my Committee just making.

Sure if I do that, I'll be returning to the chair's Committee. So I'm going to be very reluctant to do that. I. Look, I think we've reached after months of discussion where we want to be on this. And that doesn't mean my doors close. That's all I'm trying to say.

My door is always open and of course will Continue to work with opposition and you know, with Members who, who have concerns that you know are nuanced because we want to make sure that it's not the case if we can avoid it.

Madam Chair, I'll wrap up in just a second and just say I I appreciate the discussion Again, I want to make sure that we're not conflating things that really aren't affordability issues like whatever a dealer's arrangement is with a banker after they have reached the APR rate based on a full federal disclosure on a conditional sales contract with a buyer, for example, this is going to be 7.5%.

Do you like it or not? Is your credit union cheaper or not? Do you want to pay cash or not, as the chair was alluding to and that that individual can get up and walk out, can accept the seven and a half percent on the conditional sales contract and be on their way.

What the dealer does with that paper after the fact, as far as I'm concerned as an author, I just want to make this statement may not be agreed upon by everyone has nothing to do with the affordability of the vehicle.

At that point that person walked out the door with the, with the, with the bargain in the affordable as as they saw fit at that point. What happens afterwards with packaging up paper is is a whole different kind of a Bill and a whole different finance question.

With that appreciate again the discussion really appreciate the work and the admonitions from the chair and I respectfully ask for your aye vote. Thank you.

Thank you. Senator, we have a motion made by Agar Curry and a seconded by Macedo.

Madam Secretary, SB 791 by Cortese is the motion is do passed to the Committee on Appropriations. Wilson. Aye. Wilson. Aye. Davies. Davies. Aye. Aguiar. Curry. Aguiar. Curry. Aye. Aarons. Erin's not voting. Carillo. Carillo. Aye. Perabedian. Hart. Hart. Aye. Hoover. Jackson. Jackson. Aye Lackey. Lackey. Not voting. Lowenthal. Lowenthal. Not voting. Macedo. Aye. Papin. Ransom. Aye. Ransom. Aye Rogers.

Rogers. Not voting. Board.

That Bill has eight votes and we'll hold the roll open for Members to add on. Thank you. We'll be moving on to item number three, SB 34 followed by item number four, SB 703 both by Richardson. I'm going to pass the gavel over to my Vice Chair for a moment.

Senator, at your pleasure.

Thank you very much. Well, good afternoon, Members. We've been working hard and it's Monday. I get it. So I'm going to do my best to speak as succinctly and clearly and help us move forward as we go into the evening. Good afternoon, Chair and Members of this Assembly Transportation Committee.

First of all, I'd like to start off by thanking the chair and the Committee staff for working diligently with me in my office on this very important and timely measure, SB 34, while simultaneously continuing to improve air quality in the communities surrounding the San Pedro Bay port complex area and protecting jobs in our fragile economy.

I am officially accepting the proposed amendment. In terms of the scale and scope of the ports of Los Angeles and Long Beach, they're the largest single intermodal commercial gateway in the State of California, the United States, North America and the Western Hemisphere.

The complex supports 3 million jobs nationwide and supports economic activity that generates 2.78 billion in state and local taxes, plus an additional 4.73 billion in federal taxes in 2022. It is fair to say that this port complex is a tremendous asset to the State of California and the nation as a whole.

Yet, along with this amount of activity, the ports are mindful of the air quality within the area. After all, I live there, too. And to its credit, the ports have made great strides to improve their air quality.

For example, according to the latest annual emissions inventory, the total San Pedro Bay port complex emissions of diesel particulate matter decreased by 91%, nitrogen oxides decreased by 40, excuse me, by 72%, sulfur oxides decreased by 98%, and greenhouse gas gases just decreased by 20%, compared to a 2005 baseline emissions.

In a commitment to continue to address air quality, the ports of Los Angeles and Long Beach voluntarily, let me stress that again, voluntarily adopted a joint Clean Air Action Plan whose updated goals included transitioning cargo handling equipment to zero emissions by 2030 and transitioning all the dray edge trucks to zero emissions by 2035.

Given the current fluctuation in the economy, the stubborn inflation that we still face, and the imposition of tariffs that are on and off today and tomorrow, now is certainly not the time to hinder productivity at our ports and divert from the plan that is working. So you say with all of that, what is the problem?

Members, the South Coast Air Quality Management District attempted a port indirect source rule in 2024, which was opposed by both mayors of those cities, the mayor of Los Angeles Karen Bass, and Mayor Rex Richardson of Long Beach.

Now south coast is trying it again despite the port's voluntary net zero progress that they've seen and they've continued to work on. A primary goal of SB 34 is to allow the ports and appropriate stakeholders to continue its focus on meeting the Joint Clean Air Action plan targets.

What SB34 as proposed to be, amends documents that you have before you. Number one, SB 34 now clarifies that the board shall not impose a cap on cargo throughput or cruise ship passengers at the ports.

In summation, both the Assembly Natural Resources Committee and this Committee have provided substantive amendments that narrow the Bill and scope and codify some of the commitments that the South Coast Air Quality Management District have made at their stakeholder meetings and before this legislative body.

The provisions in this Bill will affect any action that the South Coast Air District takes on or after July 1, 2025. This should alleviate any concerns related to the extent that this Bill seeks to upend any previous rulings.

The Bill establishes the term action to mean that the adoption or amendment of a rule or regulation that imposes new or additional emission reduction requirements on sources of air pollution associated with the option of the ports. Finally, this Bill will remain in effect until January 1, 2031 instead of 2036. I believe that this Bill strikes a balance.

It deals with a very serious issue that I've brought before you today and I look forward to your positive motion and an aye vote. With that, I'd like to introduce our witness today, Marvin Panetta, representing ILWU.

Mr. Pineda, you have two minutes.

Thank you, Chair.

Thank you, Chair. Members Marvin Pineda, on behalf of the International Longshore and warehouse union, Locals 13, 63, and 94. We want to thank the Committee chair and the staff for all their hard work on this Bill. The ILWU for almost 100 years has loaded and unloaded ships, trucks and trains at the Port of Los Angeles.

We also load... and we also load a lot of exports that are going out of the California from the agricultural districts. A lot of the furniture, clothing or anything that you purchase for your family or home, it's coming off a lot of times from those ships.

Today, we collaborate with local governments, Harvard departments and other supply chain stakeholders to reduce emissions at the ports. As Senator Richardson mentioned, under the Clean Air Action Plan that was adopted in 2005, we have substantially reduced air pollution. Our goal is economic sustainability while also improving our environment.

I like to address the opposition as far as their anti automation arguments. The Legislature has a long history of supporting port workers. We seen in over a dozen budget trailer bills and bills where there has been anti automation language, meaning that you cannot use funds to automate ports, whether it's equipment or infrastructure.

Just in April of this year, 78% of Legislative Assembly Members voted for the Bill that has anti automation language that the opposition agreed with us and supported. And also in 2023, Casta adopted guidelines to ensure that $1.2 billion in investment for poor infrastructure is not used for automation. With that, we ask for a balanced approach.

We respectfully ask for an aye vote.

Thank you. All right, at this time, I'd like. To see if we have any me toos. And support.

Madam Chair, Members of Committee, Shane Gusman on behalf of Teamsters California and the Utility Workers Union of America Local 483 in support.

Good afternoon. Nick Chappie with the California Trucking Association in support. Thank you.

Good afternoon. Alejandro Solis on behalf of the following groups in support, Avance Democratic Club, California Human Development Center for Employment Training, Central Valley Opportunity Center, First Day Foundation, La Cooperativa Campesina de California, and Los Amigos De la Comunidad, all in support. Thank you.

Oracio Gonzalez, on behalf of California's Business Roundtable, continue to be in support of the Bill, but would like to get to a better place on the automation issue. Thank you.

Hi.

Hello. My name is Leslie Alvarado. I'm with ILWU and I am in full support of this Bill.

Hi, I'm Talia LeClaire. My father, my dad is in the ILWU and I support this Bill.

Hi, my name is Danny Campbell and my dad works for the ILWU and we support this Bill.

Hello, and I am Tim Campbell with the ILWU and I support this Bill. Thank you.

Hi, I'm Katie Gwynn with the ILWU and I support.

My name is Jared Campbell. I'm with the ILWU and I'm in full support of this.

If we have opposition witnesses, please come forward.

Maybe. Yeah, they got two.

Gentlemen, you have two minutes each. Thank you.

Good afternoon, Committee Members. My name is Chris Chavez. I am the Deputy Policy Director at Coalition for Clean Air. I am also a nearly lifelong resident of West Long Beach, saved for the time I was up here as a staffer for the California State Senate.

I'm also a Member of the West Long, or the Wilmington, Carson and West Long Beach AB617 Community Steering Committee, which identified port pollution as a key concern in its Community Mission Reductions plan. We oppose SB 34.

I'd like to respond to one of the comments made in the previous Committee hearing, which was, what was the beef with this Bill? Well, imagine this. There is a polluter in your community. While it's not the only pollution source nearby, it is the largest emitter of pollution in the region.

Both you and your neighbors have collectively spent decades working to clean it up. And just as the air district is considering how to reduce submissions from that source, a new state law from the state Capitol ties that agency's hands. That is exactly what SB34 proposes to do. That is the beef with this Bill.

We appreciate the amendments that have narrowed the scope of the Bill. We believe, however, that the language barring the district from imposing a cargo cap still invites ambiguity and litigation for opponents. Even then, SB34 sends a clear and concerning message that the state Legislature will protect the largest source of pollution in Southern California.

SB 34 is often portrayed as a district Bill, but its ramifications go far beyond Southern California. If successful, it'll provide a roadmap for the polluter lobby to shield themselves from public interest rulemaking. Moreover, it would close off yet another path to bringing clean air to the smoggiest region in California. The smoggiest region in the country.

Continually failing to meet federal air quality standards has consequences. Currently, these consequences are subsidized by families, medical bills, taxpayer dollars, and health. But these consequences can impact California's transportation system, too. The Federal Government can withdraw or withhold federal highway funding for failing to meet air quality standards. In fact, it almost pulled that trigger back in 2019.

Please finish up.

To conclude, I offer this Clean air is not a nice to have. It's a life or death situation. The zip code in my life, the lifespan in my zip code is eight years shorter than that of West Long Beach or East Long beach, do not render decades of work, tireless advocacy and community engagement to clean air moot.

Please vote no on SB34.

Okay, you can proceed.

Thank you, Committee Chair. Hello, Committee Members. My name is Wayne Nastry. I'm the Executive officer of the South Coast Air Quality Management District, and We strongly oppose SB 34.

The Bill circumvents the local public process and introduces legal ambiguity and jeopardizes our ability to regulate emissions from the largest source of pollution in our region and the entire state, that being the ports of Los Angeles and Long Beach. And while we appreciate the amendments, we still have several concerns. SB 34 sets a dangerous precedent.

The Bill would allow a single industry to bypass a local authority and setting a precedent that undermines environmental protections and weakens regulatory accountability statewide. It also undermines the local collaborative process, where we spent over eight years negotiating with port's labor, industry, local governments and communities to develop effective solutions aligned with the port's own clean air action plans.

SB 34 still creates legal uncertainty and the phrase in the Bill prohibiting a cap on cargo throughput is undefined and ambiguous. It could be interpreted to block any rule that reduces emissions if it's viewed as indirectly affecting cargo movement, even rules supporting clean infrastructure.

This ambiguity could open the door to litigation and delay rulemaking for any action that port related emissions and entities dislike, by claiming that it imposes a cap, SB34 also increases the risk of federal sanctions under the Clean Air Act, potentially including the loss of billions of dollars in federal highway funds.

In sum, SB 34 weakens local authority, threatens our economy and undermines cleaner efforts to protect public health. I urge your no vote. Thank you and I'm happy to answer any questions.

Thank you. Now moving on, Members. To Members of the public who would like to add on in their opposition to the Bill, please come to the mic. Note your name, affiliation and position. Thank you.

Good afternoon. Ana Gonzalez, Center for Community Action and Environmental justice, representing Members of San Bernardino and Riverside Counties in full opposition. Thank you.

Good evening, Madam Chair. Members Brian White, on behalf of Pacific Merchant Shipment Association, respectfully in opposition to the previous amendments that were adopted by the Previous Committee.

Jonathan Cole with Climate Action California opposed.

Good afternoon. Jacob Evans with Sierra California in opposition.

Benton Buecker here on behalf of Environment California, we strongly oppose.

Good afternoon. Madeline Hall, intern at the American Lung Association and respectfully oppose.

Good evening. Kai Clausen on behalf of Ceres, in respectful opposition. Thank you.

Good evening. Martin Radosovich on behalf of the Pacific Maritime Association in opposition to the Bill. Thank you.

Good evening. Marissa Brown, representing the Green Lighting Institute based in Oakland, strongly opposed.

Ada Welder with Earth Justice here in opposition. Also representing opposition on behalf of Environmental Entrepreneurs or E2, Los Angeles Clean Tech Incubator, Environmental Health Coalition, Regional Asthma Management And Prevention, Green Latinos Move LA, Clean Air Task Force, Ocean Conservancy, Climate Action Campaign, Pacific Environment, and Natural Resources Defense Council. Thank you.

Fatima Balziwayer with California Environmental voters in respectful opposition. Thank you.

Good evening. Marissa Hagerman with Tratton Price Consulting, registering opposition on behalf of Environmental Defense Fund and Pacific Environment. Appreciate the direction of the amendments and we'll review. Thank you.

Brendan Tuig on behalf of the California Air Pollution Control Officers Association in opposition.

Alan Abs with the Bay Area Air Quality Management District in opposition.

Rebecca Marcus on behalf of the Union of Concerned Scientists in opposition.

Thank you. Now that we've heard from Members of the public and proponents and opponents of the Bill. Moving to Members of the Committee for any follow up questions, comments or concerns. Aguiar-Curry.

Good afternoon. Oops. Yeah, good afternoon. Thank you for bringing it forward. Question I have is that so we have both sides. So I'd like to have an answer one way or the other. What plan do you have in place to meet your environmental goals and avoid impacts to employees? And where that's not possible?

What are we going to do about displaced?

Would you like me to go first? Go ahead. No, go ahead. I'll respond.

I'm sorry, could you repeat the question?

What plan do you have in place to meet your environmental goals and to avoid impacts to employees? And where that's not possible, what do we do to provide for displaced workers?

Thank you for the question. So the United States government establishes the standards for clean air, the National Ambient Air Quality Standards. Right now, Southern California, the South coast region, has the worst air quality in the nation, extreme non attainment. And so the prescriptive measures that we have to take place are much more stringent than anywhere else.

But when we look at the inventory of pollutants, we try to determine what those sources are, we try to understand how those sources are emitted, we try to understand what are the pollution control technologies that are available to those sources. And then we apply that with our understanding of our jurisdiction.

We do a socioeconomic analysis of all the things that go into it, along with CEQA analysis.

And what we do is a very lengthy process that involves trying to get as much information so that we can put forward a rule that takes into account all of the considerations, including employment impacts on economy, jobs, foregone, all of those things. The cost effectiveness are all detailed in the reports that we prepare.

The rulemaking process is a lengthy process because it involves so much study and determining what those impacts are. And it is not, it is not a clean process. There is a lot of give and take and back and forth with all of the affected stakeholders.

And so when we look at the employee impacts, that is part of the socioeconomic analysis and it's also part of the jobs that are foregone analysis. So we put forward that entire effort into the rulemaking package, into staff reports, and all of that goes out.

As the Senator noted, we have been working on our own indirect source rule for a number of years, and we are prepared to take a measure to our board in October. But we are still bringing drafts and we're still reaching out to working groups. We're still taking input.

We're still going to our own committees, such as our Mobile Source Committee, and we will be taking input as we continue to move forward. At the same time, we're also in discussions with other stakeholders, whether it be community stakeholders or the ports themselves or the cities of Los Angeles and Long Beach.

And we'll continue to go through that process. We'll continue to try to put forward a plan that addresses all of the elements and the concerns. And I'd like to point out that in the 50 years of the history of the South Coast AQMD, we have done that.

We have still allowed for tremendous growth in the south coast region and we have cleaned up the air tremendously. But we are now behind the eight ball when it comes to our efforts and our ability to move forward.

And that's because so much of the emission sources, the sources of pollution that we're now facing, are coming from the Federal Government. And when I say that, I mean it's from Federal Government controlled sources. And those are the things that we as an entity have to be able to overcome.

The Federal Government can say, regardless of the amount of emissions, that those sources that are under our control, you may still have to make up that difference. And what that does is it causes us to look at what the sources are.

And as we had said earlier, we try to make reasonable control estimates and what those emissions could be.

But if we get a finding, for instance, that we need to make more, implement all feasible measures because they would say that you haven't done it for these particular sources, that's where the imposition of potential penalties and sanctions would take into effect. So I hope I answered your question.

It's pretty broad in terms of the amount of technology work that goes into answering those, working with all of those stakeholders and then working with the Federal Government and everyone else to try to develop a plan that can get forward that doesn't provide sanctions to our regional, still provides clean air and improves public health.

I might have missed something here, but how long has the plan been? Have you guys been working on the plan?

So we've worked on a number of iterations of the plan. At first, right before the pandemic, the board had directed us to work with a memorandum of understanding. We actually thought we had made a lot of progress with both ports. One of the key requirements though under an MOU was that there be enforceable agreements.

And so we thought we had reached agreement on all the provisions. And then we went to our board meeting and at our board meeting we understood that there was a recent concern raised by one of the ports that said we don't agree to this. And that pretty much blew up our ability to move forward on the MOU.

And so then after that, the board directed us, and we were engaged in a number, and we still are engaged in a number of rulemaking efforts across different sources to look at the ports. The board at various points, has said, move forward in a rule, but also still continue the discussions on an MOU.

And so we've had those discussions going back and forth. I would like to say at this point that the board is expecting us to bring forward rule language. As I said before, we're still going in October. I'm not sure that I could say to you that in October it will be a rule, it will be something else.

Because as I said, we continue to have a dialogue with all the stakeholders, and that's what we'll continue to do.

My turn. All right, Senator, you asked two very basic questions. The first one was, what is your plan for environmental goals? From 2000 to 2007, I served on the Long Beach City Council. Dealing with the ports is not a new issue. It's one we've dealt with for decades. The City of Long Beach adopted a green flag program.

They voluntarily understood the significance of our environment. And what did the green flag program start off with? It started off with that if a vessel began to approach within 25 miles, the that that vessel then had to reduce their speed, which would reduce the emissions that was going up. What happened next?

Then we looked at what was the fuel that they were using. Could we put a hood over that. Over that head section where the emissions were going out to reduce it? Several steps had been taken. And I found it kind of interesting that the witness here had said, well, we had made a lot of progress.

He should have said that in the first part of it. But what else are we doing with our goals? As I stated, the San Pedro port complex, and this is a report that his Department, his agency actually read and approved and thought they made a lot of progress. It's called the Clean Action Plan of the Port.

2017 was a update of that particular plan. So the ports have been working since early 2000 steadily to reduce emissions to the tune of 91%. Nitrogen oxides decreased by 72%. Sulfur oxides decreased by 98%. Greenhouse gas emissions decreased by 20%. But let me further say you said, what is your plan to meet the environmental goals?

I just passed out to you a piece of paper, and what did you see was the greatest emitter vessels, 63%. zero, by the way, you heard the witness here. He said, it's a federal issue. You're damn right it is. And I hope I'm okay if I use a few coloring words here, but it's getting a little late.

So when we talk about the 63% emissions, we don't control the vessels that come in. We don't control whether we all have a standardized hookup. But what we do control is one thing. We control that. We need a 200 megawatt electrification system where the ships can plug in. That is our plan of how to significantly further reduce.

But what's the problem? LADWP has not submitted a permit, hasn't identified sighting, has not done anything to address that. And by addressing electrification, we can have at birth plugging in and we can significantly reduce it. And then you heard people talk about this is the dirtiest area. Well, let me, you know, get your thoughts on this.

So first of all, this area is surrounded by the Long Beach airport. And then you have LAX airport. Okay? So first of all, you've got aviation that's contributing. And here's the port down here. Now we're surrounded by four major freeways. The 405, the 110. You've got all this going here.

And where, when the people spoke about their opposition, where is the greatest asthma cluster? It's not down here at the port. Have you ever seen a report that said longshoremen have the most asthma and cancer? No. Where is it? It's the 710 freeway where all the trucks that leave the port come up.

And then what's our other contributor? You have the Alameda corridor. That's rail, that's federal also. And then finally you have the bridge here, which connects there. So when you talk about the dirtiest area, the port, yes, has a responsibility to reduce emissions and will continue to do so.

But our number one way to do it is through electrification and continue to implement things like zero emissions. Drayage trucks. I'd welcome any of you to come to a tour of the port. And you will see drayage trucks that are now completely, completely electrified.

So we have to continue to work with all of the tools, the items that we have to make sure that they can be electrified. But there's one thing about electrified. You got to have electricity. And right now we don't even have enough electricity to avoid the blackouts, let alone moving all of that from the port to it.

And then finally, you asked a very appropriate question. What is your plan for the workers? He didn't answer your question. What is the plan for the workers? It's really important because you're talking about the largest port complex in the western hemisphere. And we don't have a plan what happens to all that cargo that's coming here.

Our plan is a couple things. One, the port has successfully allocated money towards having an apprenticeship program, also a transitioning program for the zero emissions drayage trucks that are automated. The workout that ILWU established was that those workers now would be trained to be maintenance and to handle the maintenance of those drayage trucks.

So there's quite a few things that we're doing. And finally, what is our plan for environmental goals? Our plan is, is that right now this port is the cleanest port in the world. Cleanest. Are we perfect? Should we get better? Absolutely, we will. But we are the cleanest in the world. Thank you.

Thank you. And just to I see opposition would like to follow up. I'll let you do so. Very briefly, I would like to note that as far as outside of the coast, California does have a role. Not the feds. CARB, it's not South Coast AMD, but CARB is in charge of our coastline 23 miles out.

Just to make sure clarity for the Committee and I'll ask you to be brief. I'm not sure if my colleague is done with her questions, but I think there was something you wanted to address.

So a couple quick points. One, regarding the emission reductions. Yes, there has been a massive reduction since 2005. But if I was bragging about what I did back in 2005, I'd be talking about what I did in high school. School.

I asked you to speak directly to what you noted something that she said. Yeah.

I do want to say that if you look at the emission reductions over the past 20 years, yes, there were massive reductions initially, but those have since flatlined. And that we're still in a situation where the progress that we saw 10, 15 years ago has essentially stayed. So there have been some fluctuations.

Yes, but the progress has flatlined the other thing really quickly. On the point about automation, I would say I can't speak for every environmental organization, but I can say certainly for most that if we have to have human operated equipment, that's not our fight. I personally have family who work at the ports.

I want to make sure that their jobs are protected too. And I would say I think. Thank you.

It's duly noted that South Coast, their responsibility is not around human operators versus automation. I want to give it back to my colleague to continue her questioning if she so chooses. You're done.

Okay. Chair, if I may answer Assembly Member Curry's question about displaced workers from the union perspective.

Okay. If you could be brief.

I will be brief. The indirect source rule has being proposed does not have anything related to how we're going to handle workers that are displaced to that point.

And for the warehouse indirect rule, there was an economic impact analysis done, but it was contracted out without any feedback. And it was a. Here take it. That's what we got. So thank you.

Thank you. Looking to any other Member of Committee. Jackson, I'm sorry, I did have you listed. Was there another Member of Committee who wanted to speak on this? So I can put you in queue? All right, there we go. Jackson.

Thank you very much. Madam Chair, I think my, my question is for opposition, obviously, as you, as we look at today's regulatory environment in terms of environmental protections, are you arguing that we are no longer seeing reductions in emissions at this time, but we're flatlining? Are you just talking about specifically related to the port?

If I may. I was a former US EPA regional administrator and I've been involved with the ports back on the original Clean Air Action Plan back in the mid 2000s. And one of the examples cited was some of the things that have gone on.

But in the time since then, there has been a tremendous increase in the understanding of our knowledge on the combustion fuel within ships. And depending on the type of vessel and depending on the vessel speed, you can reduce the vessel speed and actually increase the NOX emission reductions. That was not known back in the early 2000s.

The ports have upgraded their Clean Air Action Plans, but they did not update the emission reduction projections based forward.

So, I mean, I understand. The question I'm trying to get to is when you look at what AQMD has already done. Yes.

When you look at what the ports have already voluntarily done through their own action plans, and when you look at what CARB has done overall, are we or are we not seeing a steady reduction of emissions? Or are you saying that we are no longer seeing a reduction.

We are seeing a reduction of emissions. We actually take into account all of the plans that have been developed beforehand. But what we still need are additional emission reductions. And that's why we update our plans.

And tell me why do we need additional reductions when over time we know that these emissions will continue to go down? Are you saying, like, what is, what is your argument for we need additional reductions?

So you're right. So we do see emission. We do see additional emission reductions over time as we develop regulations. Emissions are not realized at the point of adoption. So you do not see the advantage or the end result of a regulation oftentimes until 1020 even 30 years out because oftentimes you're replacing equipment.

So for instance, some of these ocean going vessel engines, they will last over 3040 years and they will continue to be utilized in operation. And then as a new rule comes into a place, then those engines eventually get phased in. Correct.