Assembly Standing Committee on Economic Development, Growth, and Household Impact

The mic on yours. Everything else needed. Hello? Hello?

Good morning. Testing? Yes.

Yes. Yes. Because I can speak.

Good morning, everyone. I would like to call this meeting to order. Welcome to this morning's Assembly Economic Development Growth and Household Impact Committee hearing to ensure members of the public and the media have access to our proceedings today.

This hearing will be streamed on the assembly's website, and members of the public can provide testimony in person in Room 127. All witnesses' testimony will be in person.

There will be no phone testimony option for this hearing. If any member of the public in the room would like to testify in a bill, I ask that you approach the microphone at the appropriate time.

To preserve the safety of everyone here and ensure that the public's access to the discussion, please follow the directions of our sergeants. We are going to begin today's hearing as a subcommittee until we have quorum. Today, we have two bills and then three ACRs.

The following bill and the two ACR consent, file item number one, AB 2163 Gonzales. File item number three, ACR 164, Baines, and file item four, ACR 166, Ávila Farías.

We will allow primary witnesses here in the room today to speak for two minutes, each with two primary witnesses per side. Any additional witnesses will be limited to name, organization they represent, and the position on the bill.

Primary witnesses in support must be those with the author or those otherwise have registered support position with the committee, and And the primary witnesses in opposition must have their opposition registered with the committee.

All other support and opposition can be stated in the standing mic when called upon simply name, affiliation, and position. Again, we're gonna wait for our quorum.

And with that, we were gonna go ahead and start with our first author who happens to be our committee Member. So we have a Committee Member, Cottie Petrie-Norris, when you're ready. Morning.

Good morning, And, thank you. I'm pleased, to join you today to present AB 2516, which will establish the California grid manufacturing initiative. California, as you know, has incredibly ambitious and incredibly important climate goals. In order to deliver on those goals, we are going to see tremendous investment over the course of the next twenty years. Achieving California's clean energy future is going to demand a 300% increase in California's electricity grid and a 350% increase in California transmission.

All of this is happening, of course, on the backdrop of a cost of living crisis that I know you, Mister Chair, as Chair of this committee, have really been focused on tackling. A big piece of that has been rising electricity costs. As chair of the utilities and energy committee, that's been a really big focus for me, and we've taken a really hard look at everything that is driving bill increases.

Sometimes that we some something that we haven't talked a lot about as a body, but that is really important is that over the course of the last five to ten years, we've seen a huge increase in the cost of the equipment that goes in to building out the grid. And in fact, since the COVID-19 pandemic, we've seen a real supply chain shortage, not just here in California, but across the country and around the world.

So taken together, California's transition to an electrified economy, combined with aging grid infrastructure and a fragile global supply chain, has created a severe shortage of critical grid equipment. The result is higher cost rate payers, slower clean energy deployment, and increased reliability risks from aging infrastructure. The goal of AB 2516 is really to take those challenges and create an opportunity.

So AB 2516 will establish the California grid manufacturing initiative within Go-Biz to address supply chain delays for critical grid infrastructure components through coordinated state action. CGMI will identify critical grid components causing delays to grid build out, coordinate state assistance, including centralized procurement where necessary, aggregate aggregate statewide statewide utility demand to reduce costs and shorten lead times, and incentivize in state manufacturing through financial insistence and public private joint ventures.

We really do believe that if we structure this correctly, this could be a, you know, win win win and deliver improved grid reliability, accelerate California's clean energy deployment, and importantly, create thousands of high road jobs for California workers. So this is an idea and a proposal that I'm really, really excited about. I'm excited to be joined by a couple of our partners in this work. Sam Couple, from UAW and Hunter Stern from IBW.

Okay. When you're ready?

Yeah. Sure.

Or?

Absolutely.

Go ahead.

Good morning, Chair and Members. Thank you so much for having us, and thank you to our author for, authoring this visionary bill. We're very excited to work with you. My name is Sam Appel. I'm the policy director for the United Auto Workers Region six, which is the Western States division of the United Auto Workers National Union.

So in California, we represent about a 100,000 workers. And those workers include manufacturing workers, thousands of manufacturing workers across a variety of supply chains, many in the clean energy economy and in the traditional fossil fossil fuel economy. We also represent thousands of workers in higher education and thousands of workers in state sciences. And what unites our members is a shared vision around the transition to clean energy.

And that vision has three pillars, making life more affordable for working class people, building high quality manufacturing jobs in California, building back to the 100,000 auto jobs that we had in Southern California only one generation ago, but in new diverse array of industries.

And three, accelerating on decarbonization. Our members really do care about delivering on climate change and fulfilling California's climate goals. So when we approached this the member, this year, our author and chair of the Energy and Utilities Committee about this bill, we, were talking about we came to her talking about the electric grid because the electric grid is such a pivotal, sector for intervention when it comes to these three goals.

Probably the most strategic sector for building high road economic development and delivering on our climate goals because the grid is where so many of the costs that are gonna fall on our members are coming from over the next two decades. So we modeled with a a set of a group of academics called the Climate and Community Institute.

Can I?

Oh, it's in the center?

The impact of the growth of the electric grid on our members and on working people in California. And that impact, if we leave the grid as is without any intervention, the cost of inflation just over what we saw from, before the pandemic would be one to two hundred billion dollars just in the cost to ratepayers from capital equipment. So that sort of impact is not something we can just leave alone.

And as the member said, challenge to opportunity, the intervention to bring down the cost of supply chain equipment is an opportunity to build the higher road jobs that we lost in a prior generation. So if we just do if we just bring 30% of the capital expenditure that the California utilities, private utilities, not including public utilities are gonna spend.

If we bring 30% of that CapEx into production in California, that's 12,500 direct jobs. That's 5,000 high road manufacturing jobs directly producing those goods. So we're talking about a level of economic development impact that's really not really comparable to what we could see in other sectors. So that's why this is such an important bill. And, you know, I think we we were gonna have a a climate person here to talk about, but I'll just highlight quickly.

We have about 4.5 gigawatts of renewable energy that's waiting to be deployed onto the grid. And just that 4.5 gigawatts alone is be is delayed due to supply chain bottlenecks. So we're talking about the three pillars here that that our members care about, jobs, climate, and affordability. Thank you.

Thank you. And you could give those to the sergeant he'll give them to us right now. Thank you. Next witness.

Yep. Good morning. My name is Hunter Stern. I'm with IBW Local 1245 and the Coalition of California Utility Employees. That coalition represents about 65,000 utility workers, electrical workers here in California.

The IBW, generally, over a 100,000. Our members build electrical equipment here in California, but it's a fractional amount of what we need. The jobs are good. We're trying to make them a little better through bargaining and training, but the opportunity that Chair Petrie Norris identified is really the interesting and and great thing about this bill. We haven't looked at the supply chain.

We haven't looked at electrical equipment manufacturing as an option to reduce costs and provide the high road jobs that most of the other elements of this transition to clean energy is is our is already providing. And it's it's been a really good thing for the IBW. It's been a really good thing for the climate and the air, and then we can make it better. And so I'm honored and very pleased, that Chair Petrie Norris is bringing this bill.

It's great insight, and it's an element we just haven't addressed before.

And I urge an aye vote.

Thank you.

Okay. With that, we're gonna go ahead and continue with, any witnesses in support of this bill. Are there any witnesses in support of this in the room?

Hello Mister Chair and Members of the committee. Ivan Fernandez of the California Labor Fed in Support. Thank you.

Good morning, Mister Chair, Members. Ignacio Hernandez here on behalf of the Communication Workers of America District 9, which covers California, Nevada, Hawaii, and Guam in support, and also on behalf of TURN, The Utility Reform Network in support.

Hi there. Rachel Lucine with BlueGreen Alliance. We're a coalition of environmental organizations and labor unions here in support of the bill. I'm also giving a support on behalf of California Green New Deal Coalition as well as Jobs to Move America. Thank you.

Good morning. My name is Julia Sebastian. I am here to represent California Labor for Climate Jobs, a coalition of 17 labor unions across the state. I'm here to offer me too in support. Thank you.

Hi. Aaron Martinez on behalf of Industrious Labs in support.

Okay, thank you. Seeing no other folks in support. Is there anyone in opposition to this bill?

Okay, seeing no one in opposition, we're gonna go ahead and bring it back to committee. Are there any questions for committee members? No? I just wanna thank the author for joining us today. Obviously, this is an important conversation.

I think one of the things that struck from your comments was, you know, ensuring that we, deal with the affordability issue and how consumers are impacted. And, obviously, hearing from your witnesses today, we could see the, importance of this conversation. So thank you to, my colleague, who also chairs, the committee. And so with that, we'll ask no other questions. If the, author wants to, wrap up.

Thank you, Mister Chair. As California built out our clean energy future, and as we electrify our economy, we are making generational and transformative investments. And if we approach this strategically, there really is an opportunity for us to make these investments in a way that is good for workers and creates thousands of high road jobs, is good for rate payers and brings down cost, and is good for California's economy as a whole. So, thank you and respectfully ask for your aye vote.

Thank you. At the right time, when we have quorum. We'll take a motion and a second, and then we'll consider it then. Thank you. In fact, thank you so much.

As we end that first author, we have I see the next author here. Moving to agenda item number five, ACR 173, mister Carrillo from the High Desert. With that, mister Carrillo proudly represents the High Desert and we're going to go ahead.

Thank you, mister chair and committee members. I'm here today to present assembly Concurrent Resolution one seven three, which commits to formalizing the sister state relationship between the state of Jalisco, Mexico, and California. As my colleagues know personally from their own bipartisan and legislative trips to Mexico.

Our state in Jalisco share long standing cultural, economic and demographic ties. Those ties between our two states represent a shared past and a collaborative future together in policies ranging from agriculture and labor, technology and education.

This resolution emphasizes diplomacy independent of federal policy shifts, highlighting collaboration and respect instead of confrontation and threats. This resolution also purposely calls out immigrant protections because that's the reality on the ground being imposed upon our state at this time.

It's sad to see a shift away from celebrating the historical contributions of immigrants to our state's agriculture, infrastructure and culture.

That's if should not be white when it's needed most, we're saying the least but that doesn't need to be the case. We can rightly raise concerns where they are warranted and we can respectfully agree to disagree on policies but there is an understanding of the need to respectfully work together at a national level.

Sometimes with evident which we have evidence ourselves with legislative visits, less with that as well. I ask for your support and aye vote on ACR 173.

Our states and peoples have much we can accomplish together, beginning with the World Cup later this year, which is a worldwide celebration. Thank you mister chair.

Thank you, mister Carrillo. With that, we'll start with any witnesses in support of ACR. We have some folks.

Okay. So no speakers in support. Is there anyone in opposition to this ACR?

Seeing no one else, we'll bring it back to committee. Are there any questions, committee members? Seeing none, I just want to say thank you to the author.

Obviously having been to some of these delegation conversations and the importance of some of our trade that we do specifically with Mexico, I think this is an important conversation to continue having.

So thank you for bringing the state to the table and with that, there's no other questions or or concerns from committee. We'll go ahead and close that with the author.

Well, thank you mister chair and committee members. I actually was born in Guadalajara, which is the capital of the state of Jalisco. That is one reason I'm here presenting this item to you in hopes again that we can reestablish what we've been working for, especially at these times when we have reasons to celebrate, like the World Cup and the Olympics coming up soon.

Again, the big impacts that we have with the economy, shared goals between Jalisco and California and I respectfully ask for your support.

Thank you, mister Carrillo. At the right time when we have quorum, we're going to bring it for a motion and second and consideration. Thank you.

Alright. Good morning, everyone. We're going to continue with today's meeting. It looks like we do have quorum now. Secretary, please call the row.[ROLL CALL]

[Roll Call]

Great. Thank you. All the builder out. Consent calendar. And with that, there's no other business. This hearing is now adjourned. Thank you, everyone.