Assembly Standing Committee on Labor and Employment

Good afternoon. Welcome to Labor and Employment. For any staffers out there who are watching this committee, please ask your members to make their way to labor and employment as well as any authors who will pre be presenting bills. Once again, welcome to the assembly labor and employment committee. We're going to go ahead and get started as a subcommittee.

We are now going to go out of order and start with item number eight, AB 2137. Assemblymember Chen, whenever you are ready.

To present AB 2137, I also wanna thank so much for the committee for analyzing this bill. They did an incredible presented to us. AB 2137 strengthens workplace safety in the artificial stone fabrication industry by requiring certification for shops that process artificial stone while holding suppliers and fabricators accountable for verifying compliance and establishing mechanisms to reduce silica dust exposure. Exposure to silica dust has become a serious public health issue in California, especially among workers who fabricate and engineer stone products.

In recent years, there has been a riot in cases of silicosis and other lung diseases tied to this industry.

Our bill builds on the foundation established by SP 20 by Senator Menjivar, which introduced strict state requirements for high exposure tasks involving artificial stone. This bill requires the state to establish a certification program for fabrication shops, ensuring that only businesses meeting strict standards are allowed to make sure they can legally operate. By expanding accountability across the supply chain by requiring suppliers to verify buyer certification, ensuring customers hire compliant contractors.

Our bill strengthens enforcement by authorizing citations and civil penalties for noncompliance and establishes a system to track violations, silicosis cases, and regional trends. It helps promoting safety in the industry and lowering long term health risk for workers.

Here with us to testify, I have Glenn Farrell and Kirk Himmelschoo from the Silica Safety Coalition. It may be in the building, but with that, I guess we'll go ahead and with your permission, madam chair, just go ahead and move forward without their testimony at this point in time.

Okay. Sounds good. Any other witnesses in support?

Jusy Yee State Building Trades in support.

Thank you.

Good afternoon. Irena Repetian on behalf of Cosatino in support.

Seeing no other witnesses in support, do we have any witnesses in opposition? You can come to the desk if you like.

No. That's fine. Okay. Jordan Uter here. Worksafe. We are in opposition.

Is this your witness and support? Okay.

Madam chair, members, apologies. We'll get this one rolling quickly. But Kurt Kimmelshue on behalf of ASTA Worldwide, the agglomerated stone manufacturers trade organization, really pleased to be with you here today. We represent a number of the manufacturers of engineered stone and natural stone products, as I'm sure mister Chen noted in his opening. Really, what the the the primary focus of the effort around this bill and follow-up to the bill last year from Senator Menjivar surrounds worker safety.

How do we make sure that the product is handled safely? And what our members know above all else is in our time cutting these products that absolutely these products can be handled safely. But it's critical that we really structure a program and a state effort in a way that ensures that air quality standards are met, that this this idea of dry cutting is

a thing of the past and that we're using wet cutting methods to make sure that silicosis is not

a disease that continues and the silica dust particles that find their way into the atmosphere when the incorrect cutting techniques are used that that caused this issue, are definitely addressed under the provisions of the bill. So we we urge your support. We know there's some ongoing efforts and and discussions with this conversation, both with the department at the Department of Industrial Relations and with the Standards Board.

We we greatly appreciate mister Chen's efforts here to make sure that we can put a regulatory framework in place that absolutely protects the workforce and ensures that we can make silicosis a thing of the past. So with that, I'm happy to happy to answer questions. Again, apologies for my tardiness and, urge an aye vote.

No worries. Thank you for being here. Turning it over to the members. Any questions or comments? Okay. At the appropriate time, we will, hopefully make a motion when I move this forward. Thank you. Thank you.

Thank you, madam chair.

Oh. Okay. It's okay. It looks like we can go ahead and establish a quorum. Madam secretary, can you please call the roll?

[Roll Call]

Okay. Actually, let's go ahead and go back to item number 8AB2137. Chen? May I have a motion and a second?

[Roll Call]

The bill is out, but we're gonna keep the roll open for our absent members. I see assembly member Erwin here, please. Whenever you are ready. That's item number one, AB1534.

Thank you. Good afternoon, Madam Chair and Members. Last year's federal budget reconciliation bill, HR 1, expanded the types of educational programs that are eligible for Pell Grants to include short-term workforce training programs lasting between eight and fifteen weeks. AB 1534 will create the necessary state process for California to approve high quality short-term programs aligned with the requirements of HR 1.

To be eligible for workforce Pell Grants, HR 1 requires short-term programs to offer participants skill-based and stackable credentials in high demand fields.

This will allow students to enter the workforce with training that leads to high paying jobs. Additionally, mid-career adults will be empowered to seek new training that aligns with the needs of their local economies or upskill so they can advance within their careers. HR 1 and this bill will unlock Pell Grants that have been historically reserved for undergraduate students that have not yet earned a bachelor's degree.

This could not have come at a better time, as there are gaps in the workforce between the needs of employers and the skills of workers that are not best addressed by traditional undergraduate degrees. The guardrails in AB 1534 will ensure that only the highest quality programs that will deliver real results for both workers and employers will be able to access this historic expansion of federal financial aid.

With me to testify in support is Manny Rodriguez, Senior California Policy Director for the Institute for College Access and Success.

Thank you very much. Good afternoon, Chair and Members. Manny Rodriguez here on behalf of TICAS. I'd like to begin by thanking the author for taking this issue on, and the committee for a great analysis. As previously mentioned, the goal of this bill is to create the necessary state process for California to approve high quality programs aligned with HR 1.

Expanding Pell Grants to these programs has real potential to meet workforce needs by training working adults, career changers, and students to ultimately move into a job faster. But these programs do have a mixed record. While some lead to meaningful job opportunities, others can leave students with little economic benefit. In fact, research shows that some workers with short-term credentials earn only $30,000 or less, and those outcomes can be worse for Black and Latino students.

So while the federal law sets kind of a bare minimum standard, it does give California some discretion on how these programs' eligibility will work out here in the state, after consultation, of course, with the Labor and Workforce Development Agency.

The state framework in this bill builds upon those minimum federal standards and includes critical consumer protections around outsourcing instruction, cost, and predatory financing options. These safeguards are especially important because workforce Pell Grants can count towards a student's lifetime eligibility, and we believe students should not spend those limited resources on programs that are overpriced or low quality. This bill ensures that California takes a responsible and intentional approach, and it's for these reasons we're proud to sponsor this and respectfully ask for an aye vote.

Thank you.

Thank you. Do we have any additional witnesses in support?

Good afternoon. Jesse Hernandez Reyes on behalf of the Campaign for College Opportunity, in support.

Maxwell Johnson on behalf of California Competes: Higher Education for a Strong Economy, in support.

Jennifer Aguilar on behalf of EdGE Coalition, in support. Thank you.

Jessica Soco on behalf of Children Now, in support.

Hey, Dean Foreman here on behalf of the Hospitality Training Academy, the training arm of Unite Here Local 11 and its contributing employers. I'm here to support the bill, but I just want to make sure that registered apprenticeships are included in this and that funding can go directly to the registered apprenticeship programs without having to go through some other vehicle.

Thank you. Seeing no other witnesses in support, any witnesses in opposition? Seeing none, I'll turn it over to the members for any comments or questions. Seeing none, Assemblymember, would you like to close?

Well, thank you, and respectfully ask for your aye vote.

We have a motion and a second. Secretary, please call the roll.

[Roll Call]

That bill is out, but we will leave the roll open for absent members.

Thank you, Chair.

I see Assemblymember Gibson is here. Item number 4, AB 2499. Whenever you are ready. Quick announcement. I forgot to say this at the beginning.

Just a reminder, each witness will have two minutes each, and those coming after will just state your name, organization, and position. Thank you.

Item number 10, I see Assemblymember Armbula here with AB 2300.

Good afternoon, madam chair and members. AB 2300 would modernize the state's workforce disbursement of federal funds to be more helpful to workers and employers. Local workforce boards are the backbone of California's employment training system, but delays in dispersing of federal funds often hinder service delivery. This can lead to barriers from job seekers trying to access training, challenges for employers seeking skilled workers, and inefficiencies and delays in meeting workforce program mandates.

This bill addresses these issues by aligning state provisions with federal WIOA requirements, authorizing a unified sub grant structure for state and federal workforce funds to local boards, treating them as a public purpose grants and exempting them from the DGS contracting approval.

This process has been used by WIOA for decades and ensures efficiency and accountability. AB 2300 is a practical system improvement measure that ensures California's workforce programs are better aligned, easier to access, and more responsive to the needs of workers and employers, helping to build a stronger, more inclusive economy. With me to testify in support is Cesar Diaz with the California Workforce Association and Jose Espinosa, who's the executive officer with the Fresno Regional Workforce Development Board.

Madam Chair and Members, Cesar Diaz on behalf of the California Workforce Association in support of 2300. The CWR represents 45 local workforce boards across the state. They help out job seekers and businesses, find skilled labor. This bill is a practical modernization that improves how workforce programs serve your constituents without sacrificing oversight. different administrative structures.

Federal funds move through a streamline sub grant process, while state funds must go through a more rigid contracting process. That disconnect creates delays, increases costs, and slows down the service to workers and employers both. This is especially problematic when we're looking at rapid deployment for plant closures or refinery closures and when we need to get those services out there quickly for workers to find the resources they need to find employment.

AB 2300 solves that problem by creating a unified sub grant model for both state and federal workforce funds. It reduces red tape while maintaining transparency and accountability, allowing programs to be delivered more quickly and efficiently.

The bill also gives the EDD flexibility to issue timely guidance outside the full APA process. That's only when appropriate, and it ensures that local boards can quickly respond to economic changes, layoffs, and new federal or state directives. For these reasons, we respectfully request your support, and thank you.

Good afternoon, Assembly. It's such a pleasure to be here. My name is Jose Espinosa. I am the former eligible training provider list coordinator for the Fresno Regional Workforce Development Board. I'm here to speak on the Fresno board as well as the local boards across the state, the 45 boards.

And by the way, Assemblymember Alanis, it's great to see you. I know we met a a little bit over a month ago, and I'm here to share a little bit with you about how this bill is gonna support the local boards. You know, we're the funding delays, it causes a few issues for local boards. One of them is that start times can get delayed.

A lot of times, local boards just like us have a timeline in terms of when we're gonna be launching a program and how it's gonna be benefiting those communities, whether those programs are on rapid response services for business closures, whether that is in forestry or projects in terms of forestry, our construction program.

And so a lot of times when it comes to those delays, it can have an impact on our contracted partners. So there's different partners that we work with in terms of being able to launch these programs. And, of course, we have to go back and let them know, hey. You know what? The funds are coming in within the time frame that we had planned for and then the impact that it has on participants.

You know, local boards, what we do is we help people with job training and job placement services. And so when you have an extension of or when there's a program that is not released or implemented within this right time frame, that recruitment gets impacted. The trust gets broken, especially when we already had a timeline that we have been promoting in the community.

And so what this bill is is gonna do is be able to make it more efficient as well as remove one of the duplicate- duplicative processes that already exists. So the bill touches on two pieces.

The first piece is a unified sum granting process. So it acts similarly to, like, a TSA precheck. TSA precheck, you know, usually, you already have your your check-in. So, yeah, you can avoid one less thing to have to do. And, of course, airports are busy.

Right now with the, with the state with the federal process, it takes two weeks to two months for us to receive federal dollars through the Workforce Innovation Opportunity Act. Through state funds, it can take four to six months. So you can see that there's a major difference in terms of time line between federal and state funds. So this can speed up the process by up to four months with this bill.

The second component of this bill is gonna be the employment development department directive exemption from the state APA process.

The beauty about this is that currently, directives can take six to eighteen months. With this bill that we are suggesting, this bill would take about two to four weeks. And so the directives would be treated similar to, like, what the Federal Government does when they provide, guidance for local boards through what's called the training and employment guidance letters, which can be released quicker. And so, that yields my time. I thank you, everybody.

Thank you. Do we have additional witnesses in support? Seeing none, any main witnesses in opposition? Seeing none, moving it over to the members. Questions, comments?

Well, good afternoon, and good to see you again. Some issues that I have with the bill. Just so you know, you you may have changed something today because I remember talking with you. But I'm uncomfortable with the easing oversight on EDD. That's the biggest issue I think I have and maybe, some of those on on my side as well.

So I think I think we can have some further talks. I think maybe after this as well, I'll lay off this for today, but I I think there's, there's definitely room to to talk about that and explain more. Thanks.

Thank you.

Do we have a motion? Second? Secretary oh, sorry. Would you like to close?

Thank you, madam chair, for the opportunity to present, and I respectfully ask for an aye vote.

Secretary, may you now please call the roll?

File item number 10, AB 2300 Arambula. Motion is do passed and we refer to committee on appropriations. Ortega?

Aye.

Ortega, aye. Alanis?

Not voting.

Alanis, not voting. Chen? Chen, not voting. Elhawary? Elhawary, aye. Kalra? Lee? Ward?

That bill is on call. We will leave the roll open for absent members. Thank you. We will now do consent calendar.

What?

We're gonna vote on consent calendar. Secretary, please call the roll.

[Roll Call]

K. The we will hold the roll open for absent members on the consent calendar. Will the following members please make their way to the Labor and Employment Committee to present your bills? Assemblymember Haney, Assemblymember Connolly, Assemblymember Zbur, Assemblymember Krell, and Assemblymember Pellerin. Assembly member Krell, whenever you are ready.

Whenever you are ready. Welcome. We were Item Number 12: AB 2646.

Perfect. Good afternoon. Thanks so much for having me. Good afternoon, Madam Chair and members. First off, thanks to the committee for working with my team on this bill.

I'm here to present Assembly Bill 2646, Farmworker Wages. Yesterday was Ag Day here at the Capitol, and we saw the rich bounty of our state. It is a $60 billion industry. We produce more fruits and vegetables in agriculture than anywhere in the world. And we do it on the backs of our farmworkers, many of whom-- most of whom, actually, are living in poverty.

So this bill is about setting a wage floor that would protect farmworker wages at a time when they are particularly vulnerable. In fact, a UC Merced farmworker health study found that 1 in 13 farmworkers have reported experiencing wage theft. There's been well-documented cases of sexual abuse in the fields. There's also the health issues that come from inhaling pesticides, excessive heat, and these are just some of the many challenges that make farmworkers particularly vulnerable.

They have lower annual earnings and are susceptible to any small, marginal shifts in consumer pricing, such as the inflation that we're experiencing right now. Uplifting their significance through fair wages provides these workers with equitable opportunities that every Californian is deserving of. Assembly Bill 2646 sets a minimum hourly wage of $19.75 an hour with an annual cost-of-living adjustment for a state-approved agricultural employees and the corresponding employees that work alongside them.

The number that we got to of $19.75 is based on the 2024 average hourly wage that was reported by California farmers. Additionally, the bill falls under the State Labor Commission's authority to collect unpaid wages if a farmworker is found to be a victim of wage theft. With me to testify, I'd like to welcome Ignacia Hernandez. She's a farmworker from Yolo County, California.

Good afternoon. My name is Ignacia Hernandez, and farmworkers support AB 2646. I have lived in Davis, California for 20 years. I have worked in the fields picking tomatoes, chilies, cucumbers, corn, melons, grapes, and now I work in lettuce production in the packing area.

My hands are the last hands to touch the lettuce before it reaches kitchen tables like yours. Our work is hard and physically demanding. I start at five in the morning, and many days, I do not know what time I will be able to go home. We are constantly pushed to move faster and faster. Even with hard work, our wages are not enough to cover basic living expenses.

My rent is 2,560 a month, and my take-home pay is just 500 a week after taxes. In total, it's $2,000 a month. As a single mother, I need to pay rent and bills first. And then I try to find enough food for home. Sometimes I go to the food bank, and I share an apartment with another family just to survive.

I also work a second job in the afternoon at a restaurant to cover the necessities. I have two children in college. I try to help my son with his rent so he can focus on his education. There are times where I have to choose between helping my son and buying the medication I need for my chronic pain.

Every parent silently questioning whether they're a good parent knows about these choices. I took today off without pay to be here because with the hope-- with the hope that you will consider farmworkers. Help us earn wages that are fair. Thank you.

Thank you. Do we have any additional witnesses in support?

Madam Chair, Matt Broad from Teamsters California, in support. Thank you.

Thank you. Elmer Lizardi with the California Federations of Labor Unions, in support.

Catalina Sanchez with the California Rural Legal Assistance Foundation, in support.

Thank you. Do we have any main witnesses in opposition?

Yeah. Good afternoon, Assembly Member Haney.

Hi.

Whenever you are ready to present Item Number Two: AB 1869.

All right. Well, thank you, Madam Chair and members. AB 1869 addresses a growing problem in our hospitality industry, real estate investment trusts, or REITs, improperly inserting themselves into hotel operations. REITs own hotel properties, but they are legally structured as passive investors. In exchange for a special tax-exempt status, they are prohibited from participating in management labor decisions or day-to-day operations.

But increasingly, that line is being crossed. We are seeing REITs influence staffing levels, workplace policies, and even labor negotiations, responsibilities that belong solely to the hotel operator. When REITs act like operators, they should not continue receiving a tax break that is explicitly conditioned on staying out of operations. Compounding this issue, there is currently no clear process for hotel workers to report when a REIT is overstepping its legal role. AB 1869 will fix both problems.

It will clearly define what constitutes direct or indirect management of a hotel by a REIT, ensuring that they are held accountable for it if they violate the conditions of their tax status. Second, it establishes a clear pathway for hospitality workers to report these violations to the Labor Commissioner. This issue became especially visible during the Covid-19 pandemic.

For example, RLJ Lodging Trust reported operating with 47% lower wages and benefits compared to prior years, all driven by cost-cutting measures imposed by workers-- imposed on workers by the REIT despite it not being permitted to manage operations. AB 1869 simply reinforces a basic principle.

If a REIT wants to act like a hotel operator, it should play by the same rules and not receive a tax benefit meant for passive investors. With me today to testify in support are Matt Broad, on behalf of Unite Here, and Anand Singh with Unite Here International.

Madam Chair and member, Matt Broad, here on behalf of Unite Here International, proud sponsor of AB 1869. I think Assembly Member Haney summed up the bill well, so I'll keep my comments short. I would just add that in 2024, the IRS Chief Counsel put out a letter, an advice letter that was-- clearly stated that, if a hotel REIT exceeded its authority, it could risk losing its tax status.

So, with that in mind, I wanna talk about what the bill actually does, which is really reporting. It just creates process at the Labor Commissioner's Office by which an aggrieved hotel worker or their representative would be able to report instances of REIT mismanagement, and then the Labor Commissioner would do a report, and the Franchise Tax Board would be copied on the findings of that report.

So just to clarify, it does not obligate the Franchise Tax Board to pull tax-favored status. And I'll just finish by saying, if hotel REITs comply with the law, they have nothing to worry about. I wanna be very clear about that. So with me today, I have Anand Singh, who's the Director at Unite Here International and gonna speak from his perspective what he's seen on the ground. Thank you.

Thank you. Madam Chair and members, thank you for the time. I-- in the 24 years that I've been with the union, with Unite Here, the hotel workers union, I've seen and we've seen the industry, the hotel industry, change radically. And what was once upon a time, you know, a collection of locally owned, locally operated mom-and-pop kind of hotel operations in cities all over this country, has evolved and changed and, you know, radically so.

So, you know, the big hotel change that we think of when we think of hotels today--Marriott, Hilton, Hyatt--they really became dominant, you know, multinational corporations in the last couple of decades.

They're no longer locally owned and operated hotels. And then in the last 10 to 15 years, those same corporations gave way to a whole ownership class of hotel owners, including hotel REITs. Those companies still exist. Hilton, Marriott, Hyatt--obviously, we see them. They are now almost exclusively hotel operators.

They're the employers we deal with at the bargaining table and who employ our members. Hotel REITs are anything but passive, you know, participants who just collect revenue. They are all over labor relations. They are all over collective bargaining. Having something as simple as a grievance at a property, you know, at one hotel, the hotel REIT weighs in on the outcome of that grievance.

This is the experience that our members have had--frustrating experience our members have had--time and again as we've seen hotel REITs become more and more dominant. They are a dominant hotel owner in a number of major markets, including San Francisco and San Diego. And the result of this is more protracted fights and struggles. You've seen a number of strikes, lengthy strikes.

We think that's gonna continue well into the future as long as hotel REITs are given this competitive advantage and don't play by the same rules as their other counterparts. So, we respectfully urge for your aye vote, and thank you for your time.

Thank you. Do we have additional witnesses in support?

Thank you, Chair and members. Elmer Lizardi with the California Federation of Labor Unions, in support.

Megan Varvais with Kaiser Advocacy, on behalf of the California Tax Reform Association, in support.

Thank you. Do we have any main witnesses in opposition?

Good afternoon, Madam chair. Armand Feliciano, on behalf of the California Hotel Lodging Association, who represents interest of about 6,000 hotel owners and operators across California. We are respectfully opposed to AB 1869. Some background information to start: real estate investment trusts, or REITs, were created decades ago by Congress to allow everyday people to invest in large projects that would normally be unavailable to them.

Fifty-six percent of Californians have invested in REITs, making them an important part of pensions like CalPERS, 401[k], 529, and other plans that have enabled everyday-- kept people to retire.

As part of their design, REITs are tax efficient but are not allowed to directly or indirectly manage, operate properties. A violation of these rules can result in fines, a 100% tax on income, and loss of REIT status. REITs can also be audited by the Franchise Tax Board. REITs are regulated. CHLA opposes AB 1869 for the following reasons.

The longstanding IRS test to determine if a REIT is managing or operating a hotel is based on an analysis of the facts and circumstances surrounding the day-to-day operation of the property. This rule has been in place for decades, create a stable environment for REITs. AB 1869 upends the stability by creating an evidentiary standard which ends California's conformity with the federal rules and will threaten REITs in California who are acting within the law.

REITs are risk-averse and will likely to be forced to sell, which will hurt communities in California. REITs are risk-averse, and they have to be. They are legally charged with protecting the funds given to them by their investors, Californians who have put their savings into these projects.

In California, we're already hearing that if this bill passes, hotels will likely be sold or closed quickly. If even a fraction of REIT owners are forced to sell because of this bill, the market will be flooded with inventory at a time when hotels are already selling. I'll close up. For all these reasons, CHLA urges a no vote on AB 1869.

Good afternoon, Madam Chair and members. Skyler Wonnacott, on behalf of the California Business Properties Association, representing commercial property owners, developers, and investors across the State of California, here in respectful opposition to AB 1869. You've already heard the direct impacts on hotel REITs, so I'll focus on the broader issue.

The bill breaks from federal conformity and creates a separate state standard, putting REITs that are otherwise in compliance with federal law in a very uncertain position. This kind of an inconsistency creates real compliance risks, and while the bill is framed around hotel REITs, it touches the same REIT rules that apply across the board.

Once California starts applying those rules differently, it won't stay limited to that one asset alone. It creates risks for REITs-backed investment in office, retail, industrial, and other commercial properties. There's also a direct impact on retirement investments. REITs are widely held through pensions, 401[k]s, and other savings vehicles across the state.

It's actually estimated that CalPERS has $6.5 billion invested into REITs as part of their broader portfolio. When you introduce uncertainty into how those investments are treated, it can affect their value, their performance, and that risk ultimately will flow through the state workers and retirees who rely on those pension funds. At the end of the day, it also makes California a less attractive place to invest. REITs were designed to give everyday investors access to real estate.

If regulatory environment becomes uncertain, that capital will remove elsewhere and Californians lose the ability to invest in their own communities. And if-- for those reasons, we respectfully urge a no vote on AB 1869.

Additional witnesses in opposition?

Good afternoon. Alexander Rossitto, on behalf of the Building Owners and Managers Association of California, as well as the California Business Roundtable, in respectful opposition.

Good afternoon, Madam Chair and member. Maria Spencer Neider with Platinum Advisors, on behalf of National Association of Real Estate Investments Trusts, in respectful opposition.

Chloe King with Political Solutions, on behalf of the California Travel Association, in respectful opposition. Thank you.

Thank you. Seeing no other witnesses in opposition, I'll turn it over to the dais for any comments or questions. Yes.

Well, thank you, Madam Chair. To be honest with you guys, I didn't know what a real estate investment trust was until this committee, so I had to make some phone calls to my district to get some information on this, and my district, unfortunately, is very opposed to this.

And for the points that you guys made and saying that nobody's gonna invest in hotels anymore, we're gonna be losing that businesses, and so, as much as I know that the author is gonna work as hard as he can, I'm hoping maybe he'll change my mind by the time it gets to the floor, but right now, I can't support this. Thank you.

We have a motion and I'll second. Okay. We have a motion and a second. Secretary-- oh, I'm sorry. Assembly Member Haney, would you like to close?

Sure. Well, you know, I just wanted to be clear that there's nothing that we're doing in this bill that is creating any new standard. If anyone is following the law as was stated by the opposition, there's nothing to worry about. We are all very clear about real estate investment trusts, REITs, and what they can and cannot do.

And all this does is providing for an opportunity for the law to actually be enforced for there to be an opportunity for the Labor Commissioner to investigate whether they're following the law. That's all we're doing here.

We're not creating new law. We're not creating new standards. We're not even-- this is not even adding any private right of action, or any fines, or anything like that. We're simply saying we agree on what REITs can and cannot do and we need to have a way for there to be a reporting mechanism to be able to ensure they're actually following that law.

That's all this does. And right now, many of them, as we know, are not following the law and are overstepping their boundaries of what they should be doing and what we all agree they should be doing under the law. There should be a way for us to actually investigate that, for people to report that, and for the law to be enforced and followed. That's what this bill would do, and respectfully ask for your aye vote.

Thank you. With that, Secretary, can you please call the roll?

File Item Number Two: AB 1869: Haney. Motion is do pass and re-refer to Committee on Appropriations. [Roll call].

That mem that bill is on call. We will leave the roll open for absent members. Assembly member, Pellerin, please. Item number 13 AB 2650.

Lucky 13. Good afternoon, chair and members. Retirement savings, while important for everyone to have, many do not plan for it until it's too late. Planning for retirement in today's economy has become increasingly more difficult to attain. As of 2020, over one fourth of non retired adults and two thirds of millennials do not have any form of retirement savings.

CalSavers was created by this body in 2016 to tackle California's retirement savings crisis. Since its launch in 2019, California has seen private employer plans grow by 15 with Cal Savers adding over 630,000 accounts to supplement that coverage. However, multiple problems are facing the Cal Savers program, which have affected implementation and require updating. AB 2650, the Save for All Workers Act creates workplace emergency savings accounts for CalSavers participants.

Additionally, it allows CalSavers to assist participants in claiming government retirement benefits by cutting red tape and clarifies that domestic employees are included in the program, ensuring that they have access to the same retirement as their boss.

The addition of a workplace emergency savings accounts is a crucial tool for CalSavers participants to weather financial emergencies and allows them to put aside a small portion of their paycheck into an account that is stable and can be accessed quickly in times of need. Lastly, the bill makes several technical updates to modernize the law, bringing the program closer to sustainability and maintaining employer compliance over time. With me to testify in support is CalSaver's deputy director, Tristan Woolicott.

Thank you. Good afternoon, chair and members of the committee. I'm Tristan Woolacott, deputy director of the CalSavers retirement savings board. CalSavers is a small agency within the treasurer's office headed by treasurer Fiona Ma, proud sponsor of AB 2650, the Save for All Workers Act. CalSavers is California's retirement savings program for employees who lack one at work. We function like other workplace retirement programs with the difference between us and private plans being that employers are not fiduciaries.

They pay no fees. And, crucially, employee accounts follow them wherever they go. Simply, they're portable. Since launching, CalSavers has grown into the largest and most successful program of its kind. Despite the success, we have plenty of room for improvement.

Such areas include growing withdrawal rates, the lack of employer contributions, administrative burdens, and persistent confusion among a small portion of the employer community. The Save for All Workers Act tackles these issues head on. Specifically, the bill creates emergency savings accounts within CalSavers, allowing our employees to save for everyday emergencies via their paycheck while crucially preserving their existing retirement investments. Additionally, the accounts allow for employer contributions without violating federal law. Both of these functions are basic features available to private plans throughout the country.

Furthermore, Bill cuts red tape, allowing CalSavers to open accounts for participants who are claiming government benefits without having them open accounts on their own. This puts us to work for Californians and maximizes the money going into our constituents' accounts. It also saves us significant time and money, keeping our fees as low as possible. Third, the bill ensures that all employees throughout California, regardless of their employment circumstance, have access to a workplace retirement program by clarifying the household employees are included in in the law.

Thank you for the opportunity to advocate for the Save for All Workers Act.

This legislation is important to our 630,000 and counting constituents. And if desired, I'm happy to answer questions.

Thank you. Any additional witnesses in support?

Megan Varve on behalf of the California Association for Microenterprise Opportunity in support.

Thank you. Do we have any additional witnesses in support?

Hi. I'm John Valley from the AARP, and our 3 and a half million members are in support.

Okay. Seeing no other members and no other, members in support, do we have any members of the public in opposition? Seeing no opposition, I'll turn it over to the dais. Do you have any questions or comments? We have a motion and a second.

Assemblymember Pellerin, would you like to close?

Thank you so much. Bill has no opposition. I respectfully ask for aye vote.

Secretary, please call the roll.

File item number thirteen, AB 2650 Pellerin. Motion is do passed and we refer to committee on appropriations. {Roll Call}

That bill remains on call for absent members. Thank you. Thank you so much. Assembly member Zbur, item number 11, AB 2634, whenever you are ready.

Thank you. Okay.

Madam chair, members, I'm proud to present AB 2634, which strengthens the high road training partnerships program funding requirements to ensure that workforce investments lead to good paying, high quality jobs. In 2017, California's workforce development board launched the high road training partnership initiative. Intended to promote industry collaboration across stakeholder groups, HRTP provides funding and a framework for workers and employers to partner and create mutually beneficial solutions.

These partnerships operate on three core principles, job quality, equity, and climate resilience, together considered the high road for employers and workers. Since its inception, California has invested approximately $370,000,000 into the program, evolving into a permanent high road workforce development model.

AB 2634 aligns high road funding requirements with California's vision for a true high road workforce by prioritizing programs with labor management partnerships to receive high road funding. Specifically, the bill directs the state when awarding grants for the HRTP program to give preference to applicants who are or who are applying on behalf of a bona fide labor management cooperative program committee. High road jobs are the backbone of a strong middle class, creating pathways out of poverty, raising wages, and improving lives for working people.

At a time of rapid economic transformation driven by automation, climate transition, and shifting labor markets, California has a unique opportunity to reaffirm our commitments to labor and to ensure that workforce development is done with the knowledge, expertise, and engagement of workers. When labor and management partner on workforce development, the result is stronger industries, a more resilient workforce, and a more competitive California economy.

I ask for your aye vote at the appropriate time. And with me today, we have two witnesses oh, there we go. We've got both of them here now. We have two witnesses today, Renee Biardo with SEIU California and the Dean Foreman, executive director of the Hospitality Training Academy.

Are you first? Okay.

You both could share ten minutes. You could start when you're ready.

Chairwoman Ortega and honorable committee members, I'm here to speak in support of the AB 2634 introduced by Assemblymember Ziburr. My name is Adine Forman. I'm the executive director of the Hospitality Training Academy, the HTA.

We are a nonprofit Taft Hartley Fund and a labor management partnership that provides no cost job training and registered apprenticeships, line cook, barista, bartender, and room attendant to prepare our students for union jobs with good wages, benefits, worker voice, and career letters in the hospitality, food service, leisure, and tourism industry. Our program outreaches into low income marginalized communities facing generational poverty as we move individuals into self sufficiency and on the road to the middle class through life changing careers.

And we have been highly successful. The snapshot of our outcomes, a 100% placement rate, every graduating student gets a job, an unparalleled 89% retention rate after one year. LA County assessed the HTA as its number one training program. We credit our success to our deep relationship with the Unite Here Local eleven and more than 170 employer partners, including Disney, Hilton, Marriott, Universal Studios, Compass Levy Restaurants, HMS host airport concessions in USC who hire our graduates.

As AB 2634 ensures that state investment support workforce programs that deliver these kind of results and no training without a pipeline to life changing employment.

Federal workforce funding has drastically declined with another 10% cut expected this year. This bill is timely as global events, including the World Cup, Super Bowl, and Olympic and Paralympic games drive demand for a skilled hospitality workforce essential to being a world class host. We urge the passage of AB 2634 to strengthen critical industries that can't be shipped overseas, expand access to good union jobs, and build a more resilient, inclusive economy. Thank you.

Thank you, madam chair, members. Rene Bayardo representing SEIU California. In recent years, California has made significant investments in high road training partnerships, and we know this model works. SEIU California and other unions are already operating high road partnerships that successfully bring employers and workers together to train workers for good quality jobs. From the beginning, high road has always meant something specific.

It means jobs with strong standards that support working families. But more recently, the program has shifted away from that model. AB 2364 simply brings us back to what high road was always intended to be. It prioritizes labor management partnerships and helps ensure these investments lead to real quality jobs. SEIU California would like to thank assembly member Zurb Zbur, sorry, for introducing the bill, and, we respectfully ask your aye vote.

Thank you. Do we have additional, comments in support?

Hi. Kate Eager. Sorry. Kate Eager with Weidman Group on behalf of the Center for Caregiver Advancement in strong support. Thank you very much.

Kate Eager with Weidman Group on behalf of the Center for Caregiver Advancement in strong support. Thank you very much.

Elmer Lizardi with the California Federation of Labor Unions in support.

Good afternoon, chair and committee. My name is Ashley De La Rosa, Government Relations Coordinator with Building Skills Partnership representing low wage property service and airport workers in support.

Good afternoon. My name is Jose Mondragon with BSP providing a meet too for the California American Policy Center in support.

Chad DeWitt with the California Community Foundation in support.

Seeing no other comments in support, do we have any, witnesses in opposition? Seeing none, moving it over to the dais for any comments or questions. We have a motion and a second. Assemblymember Zbur, would you like to close?

Aye, I wanna thank my, sponsors, for being here today and also the, the hospitality training institute, for the amazing work that they do. One of the reasons why I became interested in this bill was actually going out to the institute which trains culinary workers. It's an amazing program.

And, the reason why this bill is important is that we need to make sure that they these programs are doing what it intended to do, which were basically programs that, where we have a partnership between, with with, employers and labor, and that's what this bill is about. So with that, I will, respectfully, ask for your aye vote.

Thank you. We have a motion and a second. Secretary, please call the roll.

File item number 11, AB2634 is the burr. Motion is do passed and we refer to committee on appropriations. {Roll Call}

That bill is on call, and we will use the roll up and grab it, Melissa. Thank you. In my turn.

Okay. We're on our last bill. So colleagues, if you're listening, get here quick. AB 1888. Miss Ortega, you have the floor.

You wanna switch? Because she's my staff.

Okay.

Yeah. Exactly.

We'll figure it out.

Thank you, mister chair and members of the committee for allowing me to present AB 1888 today, which is which is joint authored by myself and assembly member Calderon. AB 1888 would require any work performed for the California safe home grant program to be performed by a skilled and trained workforce paid with prevailing wages.

Last year, AB 888 by Assembly member Calderon established the California Safe Home Grant program to help low and middle income homeowners and high wildfire risk areas afford home hardening upgrades. AB 1888 is a companion bill to ensure that taxpayer funds are used effectively and productively, requiring that the work done for the safe homes grant program is performed by highly trained and well paid workers ensures that the upgrades are done well and right the first time.

Preventing costly rework or delays is imperative to ensuring that taxpayer dollars are used well in this budget conscience time.

AB 1888 accomplishes two major California priorities at once, allows the reduction of home insurance cost for families while protecting well paying jobs in the state. Here to testify with me is the insurance commissioner, Ricardo Lara, from the California Department of Insurance, and Judy Yee, legislative advocate with the State Building and Construction Traits Council.

Thank you. Thank you, mister vice chair and committee members. What wildfire risk in California is, constant. Reshaping communities, straining our workforce, and demanding mitigation work, that is done right the first time. We know that home hardening in indefensible space improvements are among the most effective tools we have to reducing wildfire losses and stabilizing our insurance market.

That is why I proudly sponsored AB 8 a eight last year to create the safe home grant program to help income eligible residents afford these critical upgrades. Since then, dozens of legislative offices have reached out asking when constituents can apply. We are building this program in real time. Currently, we're working on securing long term funding, and we want it to succeed. But mitigation only works if the work is done correctly.

Without clear workforce standards, we risk funding projects that are inconsistent, incomplete, and ineffective. When mitigation work isn't completed correctly and to standard, homeowners may be may believe that they are protected when in fact they are not. If mitigation isn't done right, you only find out after the fire when it's too late. Homeowners shouldn't be left unprotected despite trying to do the right thing. Public dollars get spent, but when underlying risk remains and in some cases, the work must be must be redone at additional cost.

This is where labor standards matter. Decades of labor economics and construction safety research in include studies from UC Berkeley and the Midwest Economic Policy Institute clearly state that prevailing wage laws do not increase overall project cost when accounting for productivity training and reduced workforce. Skilled and trained workforce complete projects faster and with fewer errors, and workforce standards actually improve safety, reducing injury rates and liability exposure. And this is where my department role matters. Workforce standards also improve safety.

And as the state workers' compensation regulator, I see the data. Trained workers get hurt less less often, employers face fewer claims, and overall system costs stay lower. These standards protect workers but also protect employers and ultimately protect public dollars and the funding for this program. Other states similar that have similar mitigation programs, including Alabama and Louisiana, and, yes, I said Alabama and Louisiana, already include labor components because they already know that the work must be reliable, durable, and technically sound.

California is applying the same logic, but the scale is com more complex here in California.

I respectfully ask for your aye vote.

Vice chair, members, Judy Yee, on behalf of the State Building and Construction Trades Council in support of AB 1888 by the chair, we appreciate the inclusion of prevailing wage and student trained workforce standards in the bill by the chair and the insurance commissioner without being asked. The chair and insurance commissioner touched on many points of why utilizing the skilled and trained workforce and prevailing wage is important. So I'm not going to bore you with those comments.

I would just wanna focus my comments raised in the analysis by the opposition. School and train standards require workers to come from a state approved apprenticeship program over by the overseen by the division apprenticeship standards.

They are both union and nonunion. There are both union and nonunion state approved apprenticeship programs. Importantly, skilled and trained requirements are not over rigid. In many cases, only 30% of the workers must meet the standards and up to 60 for some crafts. This is not a 100% skill and train statute.

This reflects a balanced widely used policy approach adopted by the legislature to ensure skill and train workers are performing these important construction projects. These standards are critical here just as they are across California's construction projects. We appreciate their inclusion and respectfully ask for your aye vote. Thank you.

Thank you. Anyone else in the room support, please come up? Name, organization? Alright. Seeing none. Anyone in opposition? Anyone wanna come up to the mic and give anything? Okay. Careful. Alright.

No.

I gave them the opportunity. They didn't come up. I will bring it back to members. Members, any comments, questions? We'll move in a second.

Any others? Okay. Seeing none. You may close.

I would like to ask our commissioner to close.

Oh, thank you. Member, thanks. Wow. Okay. I appreciate your time. I just wanna say, you know, that this bill has the potential to create an entire new unionized workforce. You're welcome to the building trades. Appreciate you asking. I respectfully ask for an aye vote.

I already used to be on the the laboror the yeah. Thank you guys very much. Let's take the roll.

[Roll Call]

Thank you. Now we will move on to add ons. Secretary, can you please call the roll?

[Roll Call]

See no further business. We are adjourned.