Assembly Budget Subcommittee No. 5 on State Administration

Good afternoon, everybody. Everybody who loves Budget Sub-Five, your favorite budget committee. Alright. I see some hands out there. Alright.

Welcome to the Assembly Budget Subcommittee Five on state administration hearing today. Today is our last hearing before May revision. We will focus on some items from HCD, the Cal ICH, the Department of Financial Protection and Innovation, state mandates, and an update on the Help America Vote Act funds. We'll hold an update from the secretary of state on the Cal Access Replacement System and the NAP 2.0 project and an informational overview of California Arts Council funding.

This is an in person hearing with all panelists testifying in person.

We will take questions from members of the subcommittee after each panel, and public comments will be limited to up to one minute. If you are unable to attend this hearing in person, you may submit your comments via email to [email protected]. Alright. And today, we do have some vote only items. But if we do not establish a quorum, then we will hold those open.

And at this point, we don't have a quorum. So, we will begin to hear items. And if we need to move back, we will. Alright. We are gonna start with issue number one, which is HCD connect system support.

Please join us.

Is it on? Oh, there we go.

Try it again.

There. Members, my name is Matt Schuler. I'm the Chief Operating Officer with Housing and Community Development. For the first item on the HCD Connect BCP, this proposal requests permanent position authority for seven positions in '26, '27, and ongoing.

These are existing temporary positions currently working on the project under the approved project plan that are needed to further implement and support the new information technology solution, HCD Connect, for monitoring and management of loan and grant programs and housing element work. To update you on the status of the project, we have been delivering on the project milestones within the approved scope, schedule, and budget.

HCD Connect has implemented an enhanced replacement solution for housing elements and annual progress reports in November 2024, implemented a new solution for the Homekey Plus program in January 2025, and at the beginning of this month in April 2026, last month, implemented a major project release, which is functionality for the AHSC and CDBG programs. The requested positions are essential to continue the maintenance and operations of what has already been built, and to plan and implement for future system functionality.

And with that, I'd be happy to answer any questions.

Any comments?

Phaelen Parker, Department of Finance; no comments at this time, but here to answer any questions. Thank you.

Alright. Paul Steenhausen with the Analyst Office. We don't have any concerns with this proposal. Just wanna note also that no additional funding is being requested for these permanent positions. Existing funding will be used to support the positions.

Thank you. Assemblymember? Just quick question. Will or how will the HCD connect interact with programs at the HDFC programs?

Perfect. So we're currently planning for further work for the programs that remain at HCD: both our, you know, legacy and active programs. That includes government to government grants, federal programs, tribal housing programs, and the like. We're also going to cover within HCD connect the programs that will be housed at HCD, but have awards and guidelines now coordinated with HDFC, such as the developer facing components of other HCD multifamily programs, like the PLHA Competitive Piece, HOME, and the National Housing Trust Fund.

And then with regards to the in tracking of the future implementation of the programs that are moving to HDFC, we've been working with our, agency partners on planning for that IT system functionality so to to support the new committee.

Okay. Thank you. And I believe it was GovOps that brought us that really nice menu that was laminated and had all their... or GoBiz. It was GoBiz: you might think about that.

We're rolling like a big butcher paper behind us and charting this all out because some of us are very visual, and there's a lot happening. I'm actually teasing you on most of this, but there is a lot that is happening under HCD and the new orgs. I see a few smiles back there because you know what I'm talking about with all the reorg and HCD and different agencies of homelessness or their agency council; it's a lot for somebody to absorb, so really looking at one of those type of charts, I think, for future legislators could be. And you're just the person to do it.

I'm joking again. Alright. With that, do we have anybody from the public who would like to speak on this important item? Seeing no one; we will then close the item. We can't vote on it at this point, but thank you.

Welcome.

And after our Democratic Legislative Luncheon Caucus, I do get a little campy in this committee if you haven't noticed that by now. Thank you. Oh, you're still you're still here with us.

For item number two. Yes.

Alright. We are going to item number two.

Yes.

And?

Again, Matt Schuler, Chief Operating Officer with Housing and Community Development. This proposal requests $4,200,000 general fund and 16 positions in '26, '27 and ongoing, and $470,000 one-time general fund in 26' 27', all for resources to implement statutory requirements associated with eight pieces of legislation chaptered in 2025. I can provide a brief overview of each of the proposals, if you'd like or certainly could move directly to questions from the subcommittee if that would be preferable.

Any additional comments?

No additional comments at this time.

Paul?

We don't have any concerns with these proposals. As your agenda notes, the proposals closely mirror the cost estimates when these bills were going through the policy process last year.

Thank you. Assemblymember? Alright. I do not want you to go through every single piece of legislation, but it is a testament to when we put legislation through. It not only costs dollars, but it but it means that we have to often hire additional staffing, and I don't think we always realize that.

But, aside from that, can HCD provide a cost estimate for the implementation of AB 1053?

Certainly. So, I'm pleased to be able to say we do have a revised cost estimate, really due to the landscape changing since the bill was originally considered. So, when the original bill analysis was done, HCD anticipated, needing to build out a completely new program, with 25 new full time staff to administer the process. And that's really what drove that initial higher estimate. But with the creation of the housing development finance committee and this budget's accompanying trailer bill language proposals, CalHFA and HCD will reshape the implementation model.

The state will now have a shared housing development platform to streamline and centralize decision making for multifamily housing for more efficiencies at both agencies.

And under this structure, the Housing Development Finance Committee can support core functions such as application review and underwriting, reducing the need for new positions and lowering administrative overhead costs. Additionally, CalHFA has rebuilt infrastructure to administer a multifamily construction lending program, including underwriting recourse loans, dispersing funds, and monitoring construction. HCD, HDFC, and CalHFA will work together to leverage these tools to disperse HCD program funds during construction.

The state achieves the objectives of a ten fifty three at a significantly lower cost because the agency is working together reduce duplicative program build out and allow the agencies to leverage the existing infrastructure instead of creating this standalone program from scratch. So, all of that to say, the revised estimate is down to $1,900,000 from the original $6,000,000 projected in the assembly appropriations analysis.

And we like that. Thank you.

You're welcome.

Any other questions? I think I already asked. Does Assemblymember... none? Seeing anybody from the public? No one coming up.

Alright. With that, we are gonna close that item. Thank you.

Thank you.

Next, we have, issue number three, LGBTQ plus inclusive and culturally competent services: AB 678. Welcome, nice to see you.

Nice to see you too, Chair. Good afternoon, everyone. I'm Meghan Marshall. I'm the Executive Officer for the California Interagency Council on Homelessness, and here today with a request for $339,000 in one time general fund resources to implement AB 678. AB 678 directs Cal ICH to work with the LGBTQ plus communities to identify best practices, develop training and and resource strategies, propose improvements to sexual orientation, and gender identity data collection and recommend policies to prevent discrimination and harassment in state-funded homelessness programs.

So, as a note, the initial appropriation, estimate was a high level projection based on similar work.

But as this bill has advanced, Cal ICH has consulted with departments who have many years of expertise in working in LGBTQ plus equity related projects, trauma informed engagement. And with that clear understanding of the work load, we determined that the 339,000 was sufficient to to implement the bill. As a as a point of interest, LGBTQ plus individuals, especially youth and transgender or gender nonconforming persons, are disproportionately represented among people experiencing homelessness and face elevated risks of discrimination and violence.

Today, we do not have a reliable statewide number of persons experiencing homelessness who identify in this community and the federally mandated and regulated Homeless Management Information System, or HMIS, does not collect sexual orientation. We do have some insight from the California State Study of People Experiencing Homelessness or CASPEH report.

It found that nine percent of participants identified with with this community and nearly one in five transition aged youth did. And so these findings really just underscored the the need for for beta better data in a statewide collection in support of services for operators of these types of programs for this population. So, because HMIS is thoroughly regulated, we cannot mandate additional data elements to be collected. And so, as such, we have found that a contract is necessary for us to implement the the legislation.

So with that, I will take a pause and happy to answer any questions.

Thank you. Comments?

Isabel Fairclough, Department of Finance; no comment at this time, but here to take any questions.

We don't have any concerns with the requested resources.

Alright. We are just speeding - being speed racers. Assemblymember, any comment? Alright. I have no questions.

Any comments from the public? Seeing no individual running up here. We will close this item. Thank you.

We are speed racers today. Seeing that we will have a some of our members coming in and out, and it may be difficult for us to get a quorum, we will - if we do not see four members coming, then we will push, the vote only items to after May revision. We'll see if we can get four at at the same time. Alright.

Department of Financial Protection and Innovation, continuation of resources. Welcome.

Thank you, Chair and members. My name is Suzanne Martindale. I am Chief Deputy Commissioner over the Department of Financial Protection and Innovation. With me is the Chief of our Fiscal Management Office, Sarah Hamilton, as well as the Acting Deputy over our Debt Collector Licensing Program, Herb Thompson. We are here with three BCPs today, that, seek to continue existing funding and headcount for several important consumer protection programs that we administer here at the department.

First, the BCP for CCFPL continuation. The California Consumer Financial Protection Law enacted in 2020 significantly broadened our capacity to safeguard Californians against abusive and predatory products and services in the financial space. There's continual workload associated with implementing this major law, and its associated programs, which is why the governor's proposed budget includes $15,340,000 in expenditure authority for our existing 53 positions to administer this program, which helped us to strengthen the regulatory environment here in California to engage with consumers to do stakeholder outreach and facilitate complaint resolution.

Our second BCP is for continuation under our Debt Collector Licensing Act, also enacted in 2020, which authorized and, in fact, mandated the DFPI, the Stand Up Pay Program, to license, regulate, and examine debt collectors and debt buyers. The BCP for this program, asks for $13,500,000 in expenditure authority to retain our 51 existing positions, which implement and enforce regulations, conduct examinations to assess the financial health of our licensees, and ensure compliance with fair debt collection and other consumer protection laws.

The third and final BCP for continuation of funding in our BDIA program, broker dealers and investment advisors.

This is two positions previously authorized for two years and $499,000 in expenditure authority and ongoing to continue ensuring that investment adviser representatives maintain their level of knowledge and competence and and comply with recently enacted continuing education requirements under the Broker Dealer and Investment Advisor Program. Thank you very much for your time, and we are happy to answer any questions regarding any of these BCPs.

Any additional comments?

I'm with the Department of Financial Protection Innovation, but, no. We provided a handout, for you. That's a document that's produced by our, OPA, our Office of Public Affairs, and it, provides an overview of financial how to protect yourself from fraud. It's great literature. We also have a pamphlet that provides a quick view of DFPI's, wins in the past calendar year.

Maybe this side?

Taylor McRho, Department of Finance. My colleague from the LAO is gonna share some thoughts, but I'll just kinda get ahead. We...one of the things that DFPI is doing is doing manual reporting for the 2025 Budget Act, and we feel like that gives the legislature ample opportunity to ask questions about DFPI and their programs or any concerns they may have. And we just wanted - we appreciate the legislature's support of DFPI and their ongoing programs.

And we will always encourage that the partner committees, the banking, and finance committees reach out to us if you have any questions.

But I'm here to answer any questions as well.

Thank you.

Hi. Heather Gonzales with the LAO and we don't have any particular concerns with the requests, particularly for the limited term funding for the comparatively new activities at DFPI. However, in anticipation of the next request, which we think will likely be for ongoing, we would encourage, the legislature to consider gathering some additional data and evidence on the outcomes of these activities in order to have a full evaluation of these programs when they come up for their permanent request.

Thank you. Appreciate it. Assemblymembers?

I just wanna thank you and your department for the wonderful work that you do. Often it's not often that I sit on this committee and actually, you know, I'm pleased to see some of the reports and the outcomes. I wish more departments were like yours. We partner with you a lot in our communities, and this is definitely a space where I can see the direct impact of the work that you are doing. And so I just wanna say thank you.

Oh, thank you.

Thank you. I do have several questions, and I will be candid. We have had several people reach out to our office, particular. So, if you'll just bear with me, I'm gonna go through the specific questions. Given that we're trying to foster innovation in California, what steps has the department taken to evaluate whether the current assessments and examination costs for the CCFPL registrants are aligned with that goal?

Happy to take that question. So, the CCFPL put the dual mandate on the department to protect consumers and foster responsible innovation. There are multiple components to what goes into administering the CCFPL. There is a direct supervision program, which is called the our new covered persons program. That is the program with a team of examiners that after we pass a regulation to mandate registration for a four year period, this team supervises, periodically examines, gets annual reports from certain categories of financial service providers.

The regulations we currently have in place, require registration of four industry types. It's private post secondary education financing, earned wage advances, debt settlement companies, and student loan debt relief or sometimes called doc-prep companies. So, that is the pool of registrants that are currently being supervised by the team that does that portion of the CCFPL. The fees and assessments that those registrants pay go to support the administration solely of that supervision program.

What we also have at the department is a number of enforcement actions that we take under all the laws that we administer, and enforcement revenues from penalties and settlements fund the core operations, the general operations of our department.

Now what the CCFPL also did, back in 2020, was add some enhancements to our core operations, including several things, expanding a targeted outreach team to do the "Protect Yourself From Fraud," webinars and some of the other events that we host, to enhance our complaint handling team called the, "Consumer Services Office," to establish a small research and market monitoring team of data experts, and finally, to establish an office of financial technology innovation, which has four people in it.

And that is sort of like the lobby to our building for innovators. They do incredible external engagement work. They held a 100 - more than a 100 meetings last year with external stakeholders to gather insights, to share information, to discuss trends. And so, the work of the innovation office is supported by our general revenues from the department, which do come from other places but from enforcement.

So, just to be very clear, the registrants, when they pay their annual assessments to our department, they're only paying for the cost of their direct supervision and regulation. The other components of the CCFPL that I mentioned that don't directly bring in revenue, the innovation office, the complaint team, et cetera, those are paid for by the revenues we bring in in general as a a department because they are now part of our core general operations.

And related to the fees or invoices that, individuals receive, we've been told that, they were sent last year with a very short due date in 2025. So, someone might have received an invoice in, say October, and it was due by December. And in some cases, these were thousands of dollars. So, do you have a plan to possibly give more time, or can you speak to that?

Well, the the deadlines for issuing invoices and having the assessments paid are gonna be set forth in statutes and regulations, so we we need to take a look at that. However, our team is very diligent about sending out reminder notices and also does work with licensees who may have particular challenges related to paying for the assessments. So, we are happy to to take a look at that, but we do have statutory and regulatory timelines we have to follow based on the current statutes and regulations.

If you could look at that, I'm sure it's not in all cases, but in some cases, the assessments were quite large, as I said, in the thousands and for, some of these businesses, particularly, to have a short turnaround that there could be some accommodation made to pay these maybe over time. Just really kind of hone in and look at that as we've been told that they were quite large: in some cases, $50,000. Now, maybe that's not accurate, but that's what we were told. Alright.

We are gonna take a moment here before Mister Ward leaves. Yeah. Stay with us. Okay. Just to establish quorum.

[Roll Call].

Here. If you don't mind us flipping right back to the vote only and then we will come right back. Alright. We're gonna move back to vote only items, members. That would be on your second page, I think, of your agenda.

Page three. Okay. So, we have several items on the vote only calendar. We're going to take the calendar in three votes. We're gonna move forward with our first vote on issues one and seven.

Do we have a motion? Motion and a second and roll call.

[Roll Call].

Alright. We will leave that open for others to join us on that vote. Next, we're gonna vote only on issues two, four, five, six, and eight. Do you have a motion? Second.

Motion and a second. Roll call.

[Roll Call]

Right. And finally, on our vote only issue, we have issue three. We have a motion to move. Motion to move and the second roll call.

[Roll Call]

Alright. And if we get an additional member here, we will ask them to vote on that. Alright. So we are gonna go back to where we were, and there is a lot of discussion around the number of licenses for the debt collectors program.

Originally, the program was scoped at 7,000, but then adjusted down to 1,200. Can you explain what the program is currently scoped at and how the resources are scoped at 1,200?

Yeah. There's a lot of legislative history on this one. So back in 2020 when the CCFPL and debt collector laws were still legislative process, the department originally estimated, using the best good faith estimate based on data obtained from other states in the CFPB, the Consumer Financial Protection Bureau, that there may be as many as 7,000 debt collectors here in California.

When the Debt Collection Licensing Act passed, in 2021, the department engaged with the trade organizations, California Association of Collectors, RMAI, and few other stakeholders to refine the numbers to get a better estimate of what, we think the population looks like in California. And so, originally, that 7,000 number was immediately scoped back down, cut in half.

So the original, estimated 90 positions that would have been given to the department were scaled down to 51, and that's what we have today. To date, we we have 1,275 licensees and counting. So the the number keeps ticking up. The workload is absolutely there. One thing to note about implementing this law, we did our, you know, we did our estimates based on, what data we had at the time.

Now that we're in the middle of implementation, we have discovered a very, very, complex multifaceted industry. We have debt collectors, debt buyers collecting on different kinds of debt from auto to payday, to student loan, to credit card, and you name it, and different laws that may apply to each. Lots of different state and federal laws that do apply to debt collection and also, of course, with debt buying. There's a specific Fair Debt Buying Practices Act that also sets forth certain requirements as well.

And so the the the workload associated with processing licensing applications at the upfront, which had its own challenges, and then pivoting over to exams, has proven that the workload is absolutely there.

The other factor to note here is that the Debt Collection Licensing Act has very, very broad terms in it that are not well defined in terms of what constitutes engaging in the business of debt collection, what constitutes a debt being passed due, and so forth. So we have been developing regulations to clarify the scope of the licensing requirements.

That package should be moving to formal rulemaking very soon, and we know from engagement from the industry that many, stakeholders are waiting to see the outcome of the regulations before they apply for a license. And that is also a factor, and we anticipate seeing growth in the licensee pool as we finalize those regulations.

Thank you. Appreciate that. I do have two more more questions. Can you tell tell us how your licensing fees compared to other states, and can you explain why some some of Californian, California's fees are higher?

Yes. We can speak to that. The fees are apples and oranges compared to other states, but, I'll let the acting deputy speak to what we know about other states.

Pleasure. Thank you for the question. I know for California, again, we calculate on a pro rata basis. Our licensing our license is perpetual. Meaning, once we issue a license, the assessment is what we use to cover the cost to administer the program.

So again, not apples to oranges, but for Colorado, they do an annual licensing fee of 1,500 per license, as well as Massachusetts does a thousand per license plus a thousand for each branch office. So in comparison terms, 60% of our licensees paid less than a thousand dollars for their assessment this last year.

Thank you. That that's the ones that are paying more, what do you have an average on that or it depends on the type of debt?

Hi. I actually I have some information, and we're happy to provide additional. This doesn't quite answer it. But as of October 2025, the assessment was issued to 1,242 licensees. So a thousand or less, there were six 762 licensees, more than 1,000, but less than 5,271 licensees, 5,000 to 10,077 licensees, 10,000 to 100,114, and more than 100,018.

Can whoever wants to speak to at the very top tier where we're talking, you know, close to a 100,000, why is that?

Well, the way that the statute structures our fees, licensees are required to pay. Now this is netting out. Everyone pays a minimum minimum assessment of $250. All licensees pay that. In fact, a lot of people just pay the $250 in that pool of the 60%.

Then subtracting that out as well as any revenue we may have incurred from incurred from billable exams, the remaining amount is the amount that we need to assess on our licensee pool on a pro rata basis. Pro rata based on their net proceeds information. Now the net proceeds is the term in the statute. It's not a common accounting term, so we had to clarify what net proceeds means via regulation. It's roughly meant to correlate to income.

So the people who are paying the highest pro rata assessments are the people that have the largest net proceeds, and they are by and large a handful of major corporations who are paying that. If you're a small business that's got not a lot of receipts, you're probably paying that $2.50. But it varies. It's I mean, it's pro rata as as are many of our licensing programs. So the people with the largest incomes are paying the most, and the people with the lower incomes are paying less. Yep.

Alright. And last questions. If the license transfer application received since the license fee increase was passed, what percentage are being transferred to, parties or companies, affiliated with a title insurance company or real estate broker or lender of other types versus joint ventures versus unaffiliated individuals? And the same question for new licenses.

Okay. Appreciate that. And I appreciate your, very, candid answers. Any other questions from this body here? Seeing none, let's bring it to the public. Our we're gonna our comments are going to be one minute or less.

I would need more clarification about this license transfer question, so we'd be happy to talk about that with your office offline, because that is a new question.

Hi there. Clifford, California Association of Collectors. Appreciate the chair's questions. We remain very concerned that the assessments or licensing fees under the Debt Collectors Licensing Act are disproportionately high to what our members are experiencing from other states, and we really mean disproportionately high and believe that part of the problem may go back to the department overestimating the number of licensees. 7,000 originally, then taking it down to 3,500.

But as you've heard, there's only 1,200 licensees. A huge part of the calculation is based on the department's budget. So the significant problem for the future of the program if businesses choose not to operate in California. Our members are small and medium sized businesses, not large companies, but they are getting significantly higher assessments than was expected, and it is a huge problem. Thank you.

Thank you.

Madam chair, members of the committee, Ron Kingston representing the Escrow Institute of California, we submitted a letter. But here's the nut of our concerns. Last year, the last fiscal year, the assessments and fees were 2,800. They went up to no less than $7,200 per licensee per location. In addition to that, they have the DMPI has the authority to increase up to another thousand dollars.

Now it's $8,200 with no explanation to you, no explanation to the public, no explanation to anybody. Last year's enabling legislation that, increased these fees and assessments were remarkable. These are small. The escrow institute is comprised of small women based minority run businesses. They're very they're, very well organized.

They're very smart. Now who else can perform these types of escrow services? Department of real estate. $100 a year. We're at 8,200 and climbing.

The Department of Insurance, a thousand dollars a year. The question is is why should, DFPI be able to be given that type of massive authority to charge, and their fee structure totals $7,200,000 for a staffing level of 22 staff positions. We ask for increased transparency. You, the legislature, had that in mind last year. There's so little transparency that we would hope that the subcommittee and the other members of the legislature join in in demanding transparency.

So we understand what what are, our licensees paying for. Thank you.

Thank you.

Good afternoon. Tim Lynch on behalf of the Receivables Management Association International, here to express our concerns about the DCLA, BCP. We were supporters of SB 908, the bill that created licensure. We continue to support the consumer protective elements of that. But as the previous speakers and the chair have noted, we, think the scale of licensure that's included at 3,500 is roughly three times the size of the actual pool of licensees.

So we encourage you to examine that. Thank you.

Thank you.

Good afternoon, madam chair, members. Ed Howard on behalf of the office of Kat Taylor. Wanting to strongly, strongly, strongly support the reauthorization of the 51 positions for debt collection for DFPI. That is among the state's most important safety net programs. By definition, every single one of the people who will benefit by lawful debt collecting are people who are on the margins.

And if they fall because of unlawful behavior below the margins, it is the state's safety net that will have to pick up the difference. A couple of brief points about some of the points raised today. The first is that the fees are set by statute. The pro rata statute disproportionately benefits small debt collectors. You heard the data here today.

And the ones that are paying the very large debt collections because of the implementation, faithful implementation of the statute, appear to be multibillion dollar nation spanning corporations. And the third, the the, as Martin Bill mentioned, the workload justifying it. That is amply true. 30% of the complaints coming in as a part of this program are about debt collection, and the enforcement actions that the department has taken underscore how important this protection this consumer protection program is to protect your most vulnerable consumers, strongly support the budget.

Thank you.

Good afternoon. McKenna Mustazza with NextGen California. Respectfully, just wanting to uplift a program under DFPI. This isn't an item that's on the agenda today, but our understanding that it is going to go through this subcommittee.

So with the DFPI being here today, I just wanted to raise it to the committee, all of the good work that DFPI is doing with the student loan empowerment network. The network provides free student loan counseling and legal assistance to borrowers all across the state of California. The program is already secured, $4,600,000 in student debt relief for borrowers.

We've heard from borrowers, a tremendous amount of them, that the network is so crucial to them and their financial success, and this is putting dollars back into your constituent's pockets. So we respectfully ask that the funding for this program be retained in the final budget. Thank you.

Thank you.

Hi, madam chair. Randy Pollock on behalf of the International Franchise Association. This is on a different topic for DFPI. Two years ago, Senator Hamburg passed a bill that would require the registration of franchise brokers, which we think is very important because it provides consumers protection from brokers to understand what their background is before they invest a lot of money in a particular franchise. We're asking for an allocation of a $150,000 so that they can get that system up and running.

What's interesting about this is that the legislation has a fee in it of $450 for broker registration. We estimate there's somewhere between 2,000 to 3,000 brokers that would register that will fully cover this program. So we just ask for consideration of that $150,000 allocation. Thank you.

Before you leave, say say the program again, the franchise.

It's a franchise broker registration. So these are the brokers who when you're selling franchises, whether it's a fast food, gyms, going around, that brokers would have to register. The bill passed unanimously. It's just the funding part that we're just struggling with. Thank you.

Thank you. Appreciate that. I'm gonna go back to ask a question. If you can clarify related to the escrow and, as far as the initial fee being 2,800 and now potentially could be up to 8,200, comparing that to the real estate or department of insurance and how those fees have come about.

So I can speak to that, Sarah Hamilton. So previously to the fee study being conducted and then the fees being increased, the fee tied to escrow had not been raised in twenty five years. So proportionally and I can't speak to Department of Real Estate, but the costs at the DFPI are continuing to increase and had increased over the past twenty five years.

So one of the entities that we brought in to do the fee study, CRO, helped us evaluate the costs and the future of that program, and it was determined that raising the fee to $7,215 specifically would help cover the cost of that program and that we would not need to potentially, levy the additional thousand dollars.

Any other questions? Alright. Thank you. We appreciate you coming and speaking to us, and that's gonna close that. Wait.

I did have one more question. Sorry. Just on the individual who spoke on the student loan program, the 4.6, is there anybody up here who can tell us how the public can access that program on student loans?

I can speak to that. So in, I believe, fiscal year 22 23, the governor put in the budget a one time general fund appropriation to establish a student loan assistance program for Californians. The allocation was 7,250,000 for direct grants to community based organizations with the remainder for communications plan and some admin and overhead.

So for the last two fiscal years, we've been administering that program to, I believe, about 13 organizations, a mix of community based non profits that either do generalized financial coaching or do specialized assistance kinda like legal aid. And that that funding is is running out this month.

So that's what the that's what the advocate is referring to.

Can we get a list of those organizations? As I know, most of us have constituents that are really struggling with, student loans, and any type of support could mean a lot to them.

Yes. We will provide you information about the grant program after we leave today.

Alright. Thank you. That will close this item. Thank you so much. Alright. Members, we're gonna jump around to hear a little bit as we may have members coming in and out.

This one? Alright. We're gonna go ahead and take a vote on issue number three, LGBTQ plus inclusive and culturally competent services. And the recommendation is to approve as budgeted. Okay.

We've got a motion to move a second. We'll take take the role with who is here.

[Roll Call]

Do we have any other votes we need to? Item number five. We're gonna go to issue number five. The new bit mandate to suspend. And this is, to adopt placeholder trailer trailer bill language to remove the disclosure requirement and fund the cost already incurred by LA County for a total of 26,572.

Do we have a motion? We're gonna have them present on it. I'm sorry. You're gonna present.

Good afternoon. Kaily Yap, Department of Finance. The governor's budget proposes to suspend a new mandate, the disclosure requirements and deferral property taxation mandate. This mandate is estimated to cost $42,000 in 2026, '27, and $8,000 in 2027, '28, and on we're happy to answer any questions. Thank you.

Any comments?

Alex Spence, Alio. As you see in the agenda, our recommendation is that the legislature repeal the ongoing mandate, but fund the previously incurred costs. But happy to answer any other questions.

K. And do we have any comments?

Chris Hill, Department of Finance. I'd also like to add, for the record, that the Department of Finance would have concerns with the proposed sold to fund because traditionally, departments have their local agencies have to incur cost before the mandate is suspended. And when mandates are suspended, typically those incurred costs are not funded. So this would be kind of a deviation from that. Just want to note it for the record.

Alright. Members, questions or motion to move? Second. Roll call.

[Roll call].

Thank you. Alright. Members, we are on issue number six. Government operations agency trailer bill language. K.

Good afternoon, madam chair and members of the committee. Christian Beltran, actually, with the Department of Finance here to present to you on this item. Just thank you for the opportunity to be here today to present the item, which is specifically trailer billing, which amends government code section eighty three ten point four, which was amended last year with the enactment of AB 91.

First, I'd just like to begin by underscoring that, this administration is still committed to implementing the foundational requirements that were put in place by AB 91 to ensure that those in the MENA community are appropriately accounted for in critical state programs through the collection of demographic data that coincides closest to their self identified nationalities. The purpose of this trailer bill language is centered around three main principles.

First is the data nondisclosure. Second is protecting federal funding, and third is delayed implementation. So in terms of data nondisclosure, the trailer bill language requires appropriate data nondisclosure for both state and local entities. And then for protecting federal funding, it really the TBL is focused on protecting state and local programs from jeopardizing federal funding. But in some cases, there may be conflicting federal requirements for data collection.

And then in terms of delayed implementation, it really just supports successful implementation by allowing additional time for state and local agencies to, excuse me, comply with the requirements. I'm also happy to share that the administration is engaging with key stakeholders within the MENA coalition as well as with the author's office of AV 91.

And we have met twice with the coalition and will continue to do so as we try to work on language that is able to accomplish the most impact possible without jeopardizing the federal funds. And I'm also joined today by, several of my colleagues in the administration in the audience to help answer any specific questions you have. Thank you.

Thank you. No comments. No comments. Members? No comment.

No comment. No comment. Anybody from the public wishing to speak on this? Seen no individuals coming, we will close this item. Thank you.

Thank you, madam chair.

This item will be held open. Alright. We still have some voting to do members. Do we wanna go ahead and do that now or do we wanna

We're waiting for assembly member Ward, so we'll go ahead and move to item number seven. Oh, I'm sorry. See what happens, mister Ward, when you get older. I just don't even okay. So we are on item number seven, Secretary of state, have a Help American Vote Act. Welcome.

Thank you. Good afternoon, committee and members. My name is Kristen Dagsher. I'm the interim chief financial officer for the secretary of state's office, and on behalf of the secretary of state

pull that up. The microphone.

Yeah. Thank you. On behalf of secretary Weber, I'd like to thank you for the opportunity to present our proposals to you today. Our first two proposals are in furtherance of the Help America Vote Act of 2002, otherwise known as HAVA. One of them is for VoteCal and the other is for spending plans.

So I'll start with the VoteCal. VoteCal was developed in response to federal mandate. VocCal is a near real time centralized database that serves as a single system for storing and managing the official list of registered voters in the state.

We are requesting a $10,300,000 one time spending authority from the Federal Trust Fund to support the maintenance and operations vendor, data analysis consultant, security assessment, election management system support, and verification contracts to analyze and support the system for vulnerabilities and performance enhancements, connectivity costs with counties, and the maintenance of the system on the Department of Technology off premise cloud environment. Would you like me to stop for questions on that one first or go to the other one?

Why don't you just do both of them?

Okay. The second one is for the HAVA spending plan. HAVA requires states and localities to meet uniform and nondiscriminatory election technology and administration requirements applicable to federal elections. The requested 4,492,000 in one time expenditure authority will support voter education and training programs for election officials and poll workers, the development and dissemination of voting information to increase voter participation and confidence, voting system testing and approval, and county assistance, county assistance for improving voting systems.

The funding will also support election assistance for individual individuals with disabilities, election auditing, and improving at the securing administration of elections. And we're happy to answer any questions you have.

Do we have questions from members? Comments up here. Sorry.

Alina Petrichko, Department of Finance. No comments.

No comments. And I do have a question. Will when will the federal funds be fully, expended?

It is anticipated that the federal funds will be fully depleted in fiscal year twenty seven twenty eight.

Alright. With that, no questions from the members. Do we have anybody from the public that would like to speak? This is a vote item, so we will vote on both items. We have a motion.

Motion and a second. First item.

[Vote]

We have a second vote since there were two items. No. We we had two two items that we are hearing. She did them both to help America Vote Act, the spending plan. Yeah.

So that's the one we're gonna be voting on now. Yes. No. We haven't done eight. Yeah.

Item seven. Sorry. We've got a little mixed up here. So a second item on item number seven. Good?

Alright. We usually don't do vote in this committee, which is why we're having a little problem. But the second item, which is a help America vote act spending plan, the staff recommendation is to approve as budgeted. So with that, do we have anybody from the public?

So we went out of order on that too. We do not. So we're gonna be closing these items. Thank you.

Thank you. Alright.

Are we

planning on anything else?

Yeah. That's fine.

So members, we will be voting on items eight, nine, and 10. Alright. We on issue number eight, CalACCESS Access Replacement System, CARS Project. Welcome.

Thank you.

The objective of the CARS Project is to replace the outdated CAL Access for electronic reporting of the campaign and campaign finance and lobbying activities mandated by the political reform act. The request before you is for one time funding for 11,800,000 in general fund to support the continuation of the cars project.

Specifically, the request would provide funding to support the final months of the project execution and the first few months of maintenance and operation, continued funding for thirty three prior approved positions and backfill staff to support ongoing program activities, and contracted services, including the prime vendor, CDT project oversight services, and technology costs. Happy to answer any questions.

Thank you. Any comments?

Oina Patricio, Department of Finance. No comments?

Go ahead. No

comments? No. Members?

Thank you for bringing this item for I know we've seen this several years and or a lot of investment going into this, this, important program. Although Calix is is, you know, pretty archaic, it's still dysfunctional if you know how to navigate it. My one, how much have we spent to date, and you you can include this 11,800,000 request as well. What would what would the total cost for this project have come to? I'm sure

it was.

The total spent to date.

Total spending of the prod this project to date? Yes.

Okay. I have that.

Of the total the total total project cost for this entire project started in February 2022. Right? I'm sorry. My name is John Heinlein. I'm the associate assistant project director for the cars project.

So the total the total cost for this project, 92,352,323.

I think it's been a lot of general fund. Yeah.

Okay.

And what

about the expenditures to date? Just so you asked. Okay. 36,877,356. Expended.

what How

Yeah. So what's the what's the delta there? Why haven't we expended down what am I calculating here? 60,000,000 or so?

Or or

why are we at $326,000,000 as opposed to?

36,000,000 expended, but you said there was 90 something.

Yeah. The total project costs $92,000,000. That includes one fiscal year of m and o maintenance and operations.

Uh-huh.

So right now, you know, the cars project's going to be the system. The new system's gonna be implemented in four different program increments. So after the fourth program increment, it will go live. Currently, the first two pro and then and then we did this on purpose because we did it so that we get we know we have a working software early on in the project. So each program increment is is designed, developed, and you user acceptance tested by the stakeholders.

And then the vendor has a pay point for the vendor. So two of those program increments have been, accepted. We're working on the third and fourth right now. So some of that some of that funding trails and will be, you know, will be, you know, will be, expended once these program increments are are accepted.

It just feels significant that we've only had 36,000,000 expended and, if the total project cost is 92,000,000 or something you said, there's a there's quite a delta there.

I think it has to do with the fact that this doesn't, I think, reflect the late the second program increment that was recently approved. That that's, I think, set you know, close to $7,000,000. And then there's two other program increments too. So I think it's a matter of Kinda lagging costs.

Okay.

And so Yeah. We're all

scheduled to expend the money. Yeah.

And so notes here suggest that this will be functional by November 2026.

Okay.

Is

that still on on, your target date?

Yes. That's our target date.

I I heard you say, and I I did wanna ask this question sort of what is your engagement with, you know, you know, potential users for quality control purposes. I would hate for something to go live and it'd be dysfunctional to the users that normally want that kind of pulling access.

Yeah. Or the So if you're asking about yeah. Are we are we bringing in external users? Because part of the cars, system is used internally by the political reform division

Uh-huh.

Group. So we we use our accept and test with those folks. They also know the the processes that are used by the external stakeholders, as well the people that use the system, the campaigns, the committees, the the lobbyists. So, you know, we recently we we we've been meeting with the external stakeholder groups since the planning phase of this project. Okay.

So recently, we brought them in to do user testing. And there was two two one week periods where they that we we gave them months in advance notice where they they volunteered to come in and we set them up. We train them. We we we assign them a mentor and they tested the system each. There's like, I think it was nine per week came in and tested the system.

We intend to do this again once the public portal piece is completed. Great.

How far back will data be imported? All all of it will be imported back. Okay.

Yeah. Okay. Great.

Okay. Thank you. It's all my questions.

Thank you. Great questions and appreciate the response. So just to underline, we believe this is gonna be up and operating by November 2026. Yes. Just a few months away.

Yes.

Alright. Thank you. No additional questions. We have anybody from the public wishing to speak on this item? This is a vote item members.

Do I have a motion? Motion and a second. Roll call.

Assemblymember Quirk Silva.

Aye.

Assemblymember Clozan. Assemblymember Haney. Assemblymember Ortega. Aye. Assemblymember Wallace.

Assemblymember Ward. Aye.

Thank you. That item is closed. We're going to issue number nine. Notary notary automation program replacement project.

Yes. Thank you. That the project excuse me. The project is otherwise known as NAP two point o. The system is approximately thirty years old.

It was developed utilizing an application that in present day is running on obsolete and unsupported technology. The application itself is in a programming language that has been deprecated. This combination presents high risk and security issues for the department and challenges the ability to find a qualified, information technology staff or vendors to support the application. The current technology has evolved significantly since the system was created. Thus, integration of the legacy system with the current and future technology and possibly third party systems is impractical and near impossible.

Only migration of existing data to a new system is a viable solution. The request will provide one time funding of 9,795,000 business fees fund for the continuation of the NAP two point o project, which for which will, be for continued funding of the 15 positions that were previously approved, funding for temporary staff to backfill program positions redirected to the project, and funding for interdepartmental services provided by DGS and CDT, and continued planning resources. Happy to answer any questions.

Thank you. Alina Patricio, Department of Finance. No additional comments.

Right. No comments. Any questions, comments? I have none. Any individuals from the public wanting to speak?

Seeing none, we will vote on this item. Do I have a motion? Motion in a second. Roll call.

Assembly member Quirk Silva. Aye. Assembly member Clozan. Senator Haney. Senator Ortega.

Aye. Senator Wallace. Assembly member Ward. Aye.

Alright. And our last exciting item on the secretary of state, we have elected official and candidate confidential voter registration, AB 1392.

Thank you. VoteCal is set up to help is a required state voter registration system that includes the near real time integration with the 58 counties voter registration databases within their election management systems.

To meet the requirements of AB 1392, vote count must be modified to allow voter records for elected officials and candidates to be designated as confidential voters while still allowing disclosure through voter registration file requests, allow elected officials and candidates to opt out of having their voter information voter registration information made confidential, and generate lists of federal and state elected officials and candidates identified in the voter registration module.

Once vote count is modified, the SOS must contract with the election management system vendors to integrate the changes into their systems. Last minute amendments in the state appropriations committee hearing material materially expanded the bill's requirements by creating new statutory duties, new confidentiality and disclosure frameworks, extensive system modifications, and new ongoing administrative workloads without our opportunity to amend our previously submitted fiscal impact.

Therefore, we're in front of you today requesting a one time augmentation of 660,000 in general fund for 2627 to implement the confidential voter registration requirements of AB 1392. That amount is comprised of $510,000 for the modification of vote count, and a $150,000 to integrate the changes into the EMS systems, the election management systems. Happy to answer any questions.

Thank you. Department of Finance. LAO? Questions? I have a comment.

I mean, this seems a kind of a quiet thing on our agenda, and it really actually is extremely important as we look at the political climate that we are living in across The United States and and maybe even other countries. We know that, I'll I'll just read it. AB 1392 makes voter registration information for all elected officials and candidates confidential, excluding it from voter file requests and most disclosures, while still allowing release of name, address, phone, and email for journalism or government purposes.

Officials and candidates may opt out confidentially. And that's the point is we I think many of us have been witness or been targets of some of this political violence, whether it's individuals showing up at your doorstep, which is not unheard of, whether it's at our our state offices.

And sadly, I think we won't see more legislation that will come in the future related to not only privacy, but also to protection, because there are just too many individuals out there that have decided that elected officials, whether the Republican or Democrats, are now the enemy. And, I mean, just last week, we saw at the correspondent's dinner. These are real actions and anything we can do to, protect those who are serving, I think is important. But with that, we have no questions here.

And do we have anybody from the public wanting to speak on this?

Seeing none, I wanna thank you and thank the secretary of State's office. We do have a a vote on this item. A motion. A motion. Second.

Second.

Assembly member Quirk Silva. Aye. Assembly member Clozant. Assembly member Haney. Assembly member Ortega.

Aye.

Assembly member Wallace. Assembly member Ward. Aye.

That will close I out item number 11. This is an informational this last item, issue number 11, California Arts Council informational overview. And, if we get mister Haney to come in, we might interrupt and take a a vote count as he joins us. Welcome to our friends in the art world who are the friends of all of ours. Right?

Friends of the arts. Friends of the art.

Please introduce yourself as

you do

your best. Afternoon, madam chair Quirk Silva and members of the committee. My name is Danielle Brazell, and I have the distinct honor of leading this incredible agency since 2023. We're glad to be here in our fiftieth anniversary year, five decades of creative impacts, five decades of championing transformative power of the arts. And in the past seven years, there's been historic investments.

Creative course at 60,000,000, cultural districts at 10, and the creative economy strategic plan. The arts council was established in 1976 as a state arts agency. We are here to strengthen access to the arts, to culture, and creative expression as the tools to create a better California for all. We support a practice of artistic quality and equity for California's over 16,000 varied nonprofit arts and cultural sector, and we're the only statewide funder of the arts with funding that is accessible to all 58 counties.

And we wanna just thank you for helping to make that possible.

I wanna extend an invitation for my extraordinary dynamic leadership team to introduce themselves, because you should know these women, chief deputy director Michelle Radman, and, deputy director Silvia Britt. Would you like to take a moment just to introduce yourself to the committee?

Yes. Thank you, Danielle. Good afternoon, chair and members of the committee. I'm chief deputy director Michelle Radman. Michael.

Thank you. Thank you again for having us here today. Thank you. I was appointed last August or August 2024. And prior to that, I was deputy director for the California office of small business advocate within GoBiz.

So I bridge economic development my past thirteen years with arts, and see that arts and culture is a vehicle for economic vitality in California. So I look forward to the conversation and answering any questions that you have today.

Thank you.

Hello, members. My name is Silvia Britt, and I'm feeling

a little campy too. So I'm looking forward to

this conversation. I'm the dev director here at the California Arts Council, and looking forward to your questions and any information we can provide.

That's it for us, madam chair. We yield the floor to you.

Alright. And from our department of finance?

No. Nothing. And our LAO, Heather Gonzales, LAO here for questions.

Alright. And I know this is a passion for our, assembly member from San Diego.

I don't think I'm alone, madam chair. I know it's a passion for yours as well. No. I appreciate, the chance to be able to review this item here before committee today. I know we were already scheduled, but it's critical.

I think that we make sure that we're having a little bit of a spotlight on the need that we have for the creative economy, and especially for the work that the California Arts Council does. It's been a pleasure to be able to engage so closely with you across our state, to be able to support so many of the community organizations. And it's not lost on me, as many of our local governments are also grappling with the fiscal crisis.

A good and significant source of many of these local community based organizations come from those local government decisions that are really stressed right now. I'm grateful to the governor for, in his January draft, being able to show an allocation, really a status quo allocation of that $36,000,000 but certainly very supportive of the work that our colleagues, something that Rogers has been able to lead on.

And I've been happy to, jump right on that as well too, to celebrate your fiftieth anniversary, of the California Arts Council with an allocation of $50,000,000 I know it's in the mix of all the discussion that we're having, across our budget subcommittees, but it's not lost on many of these Assembly members because we all benefit, from the work that we're doing.

I wonder if you could just talk a little bit about maybe say, you know, in the last two years or so, just some key examples of, you know, some of the work that's been put out and the economic benefit that's occurred from the support, the grant making that you do through the California Arts Council?

Yeah. Absolutely. In general, a grant dollar awarded by the state of California generates another 6 to $8 in local community. An acute core principle of any economic measure is how long that dollar stays in a community. Right?

And so what we see is that our durable investment in arts and culture is about investing local and keeping those dollars local. The other thing that happens is you well noted assembly member award is that a state dollar is leveraged by a local dollar from local government because these are public benefit corporations. They are serving the interest of the public. The other thing that's really important is that it leverages additional revenue from local philanthropy and from local business.

So it's really that kind of structured four legged stool that is really critical to advancing arts and culture in our state.

I wanna yield this to my colleagues if there's any additional information you wanna share.

Thank you. Chief deputy director Michelle Redmond, I wanna share about the cultural districts program that we administer at the California Arts Council. In there are total 24 cultural districts. The original 14 from the first cohort were designated in 2017 with an infusion of $10,000,000 to those cultural districts. And then in this past year, we were able to designate another 10 cultural districts.

And so a part of that program is, scaling up the cultural district infrastructure, bringing in workforce, bringing up scaling in the workforce there as well as focusing in on economic development and cultural preservation. So we're very proud to be able to administer that program. Currently, those designees have $10,000 for each cultural district at this time. So that is one of the programs that we're very proud to be able to administer. And I know some of those cultural districts are within your districts as well.

Thank you. Yeah. I have a few questions.

alright. I didn't know if you sorry.

Oh, that's

Sorry. You weren't finished.

No. No. No. I wasn't invited if you wanted to do vote add ons or if you

Are you gonna be with us just for a fin so we can finish this item and then vote? Okay.

No. The only thing that I I'm really glad you brought that up as well too. It's another letter that we have out there is in addition to the $50,000,000 of ongoing enhanced grant making that we do for so many of our community organizations through the arts council that we are able to actually have a really significant year to support our cultural districts because $10,000 every two years per district does not stretch very far.

I'm not even sure if I get you a plaque to designate the district to be seen locally. But we know we need a lot of investment in infrastructure and programming if these are truly gems of California across the state.

And 24 is spread pretty thin across the big golden state. I'd love to see an enhancement and see additional designations as the process would allow. But I certainly would love to be able to support those that have already been designated because we don't need them falling into disrepair. They themselves are economic generators. There's a reason they're designated.

They have pride. They have local pride in addition to that statewide designation and it really intersects with a lot of the tourism aspect of what we're trying to be able to support regionally.

And along the line of tourism, when I think about, you know, the major events that we have coming up in the Olympic and the Paralympic games with the World Cup coming up well to this year, and this summer, I think, probably right in the middle of our fiscal year beginning, you know, it's not lost on me that we need to talk about the arts in California because that's the lasting impression that the world gets to see about the culture that we are, the rich and diverse culture that we are.

And we're going to need to make sure that we're supporting a lot of our local artists and a lot of our organizations to be able to display what we the message that we want to have take home. So this is the year it made that sizable investment and really up it.

The Arts Council has had I think significant investments in past years prior to some economic downturns and just never really fully got back to that level of funding certainly adjusted over time that a lot of our local organizations and artists once enjoyed. So to any capacity in this very difficult budget year and especially in light of the stressors that we have in many of our local governments, I hope that this is something that will get over the hump and that we can continue.

I'm grateful to all of our colleagues in the assembly who have cosigned one or both of these letters as well to be able to support you in the work that you're doing, and we'll keep fighting. So thank you, madam chair.

Thank you. Thank you. Assemblymember Haney? Well, I have lots to say, but first of all, I was happy, and I actually saw some photos of this, that former governor Jerry Brown attended your reception related to the fifty years of the art council. And it certainly is important as we know that he does not often come back to town if you want to say related to these types of events.

So I think that's really significant. So I wanted to shout that out. Second, both assembly member Ward and myself have served as the arts and entertainment chairs and have seen, I think, over the handful of years that I've been here well, it's actually over a decade now. The cultural districts, I know originally at 14 mil 14 districts. And did you say that they initially got 10,000,000 each?

Is that what you said?

Chief deputy director Michelle Radman. It was 10,000,000 for the whole program. Okay. $99,400,000 was allocated to all 10 14, excuse me, districts. Each district got approximately $671,000 total.

Okay. So the additional 14 districts then or I guess 10 additional districts, are now getting maybe 10,000 is what was said. So that's certainly

A a point of clarification, there the the the original 14 received that influx of six seventy one per district. The California Arts Council oversees the appointed members of the council oversee policy. They, allocated a $100,000 and gave the agency, essentially approval to designate and run a process to designate 10 new districts. So those 10 new districts got $10,000 each. The original cohort are currently unfunded.

They may get funding through our other program offerings.

If we could get, two pieces of information, one would be, who the new, 10 additional or just all of the cultural districts because I can't remember back all of them. And then second, if we can get your latest lit list of arts grants. I know we had and, again, just to to remember, the arts council was, I think, three or four years ago, slated to get some significant cuts, and we're really happy that that did not happen. And we appreciate that from the governor's office.

But we also know that this is your fiftieth anniversary, and we are hoping that there can be some reinvestment for that.

But I think one of the things that speaks to me particularly this year related to the arts is we often see what happens in the world or The United States or in California, and that plays out in the art world. And it can play out in music. It can play out in theater and dance.

And in this last year, there has been so much trauma put that our communities are interfacing with related to immigration and related to not just our Latino community, but especially our community our Latino community, but other communities as well, the fear that they're facing, the tearing apart of families, even the killings of some of these individuals who have actually been, taken to prisons. I think it's close to over 50 or 60 individuals, let alone the, Minnesota, and we saw a song come out from Bruce Springsteen.

So when things happen in our community, we see them showing through art. And just, I believe, yesterday or this weekend maybe, one of the artists brought up onto stage, the mariachis that were, detained by ICE, Casey Musgraves. And these are statements, and these are the way artists define who they are, in addition to Coachella where you had Carol g bring up Mariachi's, to play alongside of her. And so that's why to me, art is so important because it isn't just the venues to see the paintings.

It isn't all of that.

It's what happens in our community gets manifested whether it's in print, whether it's on canvas, whether it's through song or dance, and so much throughout our history is about the pain. And, of course, it's about joy too, but it's often about what's Harabedian, and that's why this this item is so important. So I wanna thank my colleague for asking us to hold this open. And with that, that's an informational hearing. Do we have anybody who would like to speak on this?

Okay. We we need sorry. We we're gonna hear you. We promise. We're gonna have the vote here, which is we're gonna go really fast.

This is speed voting, and then we will hear from the public. Okay. It's on vote only calendar issue one and seven. Can we get a roll call?

Assembly member Haney.

Okay. Issues number two, four, five, six, and eight. Roll call? Assembly member Haney. Issue three?

Assembly member Haney.

Okay. On the I the on the items to be heard in issue number three, LGBTQ plus inclusive and culturally competent services.

Assemblymember Haney.

We have more, mister Haney. We're going fast. Issue number five.

Assemblymember Haney.

Issue number seven.

Assemblymember Haney.

Issue number eight.

Assemblymember Haney.

Issue number nine.

Assembly member Haney.

And issue issue number 10.

Assembly member Haney.

Alright. Thank you, mister Haney, for returning. Thank you to the panelists, and let's hear from the public.

Hi. Good afternoon. Thank you so much for hearing this item today. Julie Baker, California arts advocates.

Like how you like that.

What if I told you that you could make a single modest yet proven high impact investment for all California communities, one that consistently delivers in areas like combating isolation and loneliness, fostering community pride and belonging, enhancing public safety, strengthening civic infrastructure, boosting youth engagement, and driving improvements in health, wellness, and economic development. An investment that would go to an agency that for half a century has consistently achieved results for exceeding its budget, yet remains at a funding level lower than it was twenty five years ago.

At a time when the Federal Government is attempting to cut cultural funding, they're actually trying to close the NEA, and suppress free expression, and AI poses a risk to creative jobs. California can demonstrate its strength through an unwavering commitment to diversity, asserting that culture and creativity are essential to our civic lives and to public good.

Therefore, we urge the subcommittee to support, and we thank you, assembly member Chris Rogers' budget request, which seeks to increase the California Arts Council grant making appropriation for from 24,000,000 to 50,000,000.

This request is cosigned by committee members Haney, Ward, and Ortega and is strongly supported by nearly 350 labor unions, trade associations, creative businesses, arts nonprofits, and mayors Barbara Lee and Kevin McCarty. While, we also urge support for investing in the cultural district program, which is currently unfunded.

While 26,000,000 is a negligible amount in the context of the state's $260,000,000,000 plus budget, this investment would, in fact, double the number of grants to community based non profit the agency is able to award and move California from thirty fifth in the nation for per capita funding to in the top 20. Given the current temporary surplus driven by the AI boom, it is only fitting that this unexpected windfall be directed towards supporting human creativity.

Such an investment is profoundly meaningful and would be a tremendous affirmation for all arts and culture workers throughout the state.

Thank you so much.

Thank you.

Good afternoon, madam chair and members. Thank you so much for the opportunity to speak today. It's great to see you all. My name is Sean Fenton. I'm the executive director of Theater Bay Area, and I also serve as the president of the board for California Arts Advocates.

I'm here today in strong support of increasing the CAC's local assistance grant funding to $50,000,000 and the agency's fiftieth year. As you know, the CAC is the backbone of arts infrastructure in California. Its grants reach communities that often do not have access to other sources of funding, especially rural communities, small organizations, cultural organizations, and BIPOC led organizations. And when the CAC is underfunded, those are the communities that feel it first. And we are already seeing the consequences of this gap.

In recent years, we have lost beloved community institutions like Aurora Theater Company, Cutting Ball Theater, Bay Area Children's Theater, and too many more re re representing not just artistic loss, but the loss of jobs, access, and cultural infrastructure in their communities. These are not abstract impacts. CAC grants support, arts education, community based programs, cultural districts, and local organizations that are deeply embedded in the communities they serve.

As executive director of Theater Bay Area, I see this directly as so many of our member companies, receive support from the CAC including, San Francisco Bay Area Theater Company, African American Shakespeare, and so many more. And right now, demand far exceeds avail exceeds available funding.

Many qualified applicants are turned away each year not because of a lack of merit, but simply due to a lack of available resources. And that represents missed opportunities for communities across California. I also wanna be clear about the request itself. The $50,000,000 ask is not, is for the is for local assistance grant funding, not the total agency budget. And while the $50,000,000 number aligns with the Arts Council's fiftieth anniversary, this is not just symbolic.

This number reflects the real demand we're seeing across California. And as Julie said, begins to move the state closer to national norms and per capita arts spend funding. So in this fiftieth year for the CAC, this is a practical and meaningful step, and we urge you to increase CAC local assistance funding to 50,000,000. Thank you very much for your leadership and support.

Thank you.

Good afternoon, Chair Quirk Silva and members. I'm Eliza Tudor, executive director at Nevada County Arts Council, a state local partner under the California Arts Council, an administering partner for two California cultural districts, Grass Valley, Nevada City, and Truckee. I'm here to urge state investment in California for the arts' fifty and fifty campaign, dollars 50,000,000 for California Arts Council in its fiftieth anniversary year, including $10,000,000 for California cultural districts. This is an urgent moment.

The governor's January budget proposal included no new investments for arts and culture just as communities are looking to the arts to help with economic recovery, downtown vitality, tourism, youth opportunity, belonging, and civic trust.

In Nevada County, cultural district funding is not symbolic. It is practical infrastructure. It allows us to coordinate across two very different rural districts from the Sierra Foothills in the West to the High Sierra in the East. It supports the work of convening cities, chambers, tourism partners, indigenous and cultural heritage partners, small businesses, artists, venues, and county leadership around shared priorities.

It strengthens cultural tourism, elevates creative businesses, supports main streets and historic downtowns, and builds partnerships that no single city, chamber, nonprofit, nor volunteer group could sustain alone.

But cultural districts cannot thrive on designation alone. Without state investment, the burden falls back on already stretched local organizations and community partners. The result is uneven capacity, lost momentum, and missed opportunity in the very regions this program is designed to serve. California's creative sector is economic infrastructure, civic infrastructure, and community infrastructure. If we want every region of California to benefit from arts and culture, then state investment must follow state vision.

I respect respectfully urge you to invest 50,000,000 in the California Arts Council, including 10,000,000 for the California Cultural District program. Thank you. Thank you.

Good afternoon, everyone. My name is Richard Falcon. I am the founder and executive director of Theatro Nowa here in Sacramento celebrating our twentieth year bringing forward culturally relevant Latino programming, not just for Latino culture, but for everyone. And for a moment, I wanna talk about the audacity of hope that our one time president Obama talked about.

Because one of the things I have found in my travels through as someone who had an opportunity to administer the creative core for the Capital Region, as someone currently now with our organization is administering the individual artist fellowship here for the Capital Region.

When I get to travel through all the arts organizations and the artists throughout the area that I serve and throughout the state, regardless of the funding, we still have the audacity of hope because we know in our hearts the benefits that we provide. We know culturally what we're able to carry and bring forward to California, the nation, and the world. So we are grateful.

I can tell you just for me personally and my organization, if not for the California Arts Council and some of the funding we received elsewhere, we wouldn't be here celebrating our twentieth anniversary and carrying forward with this audacity of hope. So with that, we would like to please beseech you.

Bring that funding forward. Let us show you what we can do. The creative core showed it. We show it every day. And a lot of the issues that you are talking about and trying to solve in the state.

Let an artist help you to design some of those policies and programs that you are bringing forward. Thank you so much.

Thank you.

Good morning. My name is Jaya King, and I am an artist and muralist here in Sacramento. I've experienced firsthand support from the California Arts Council Impact Grant. I created a public mural in Sacramento focused on domestic violence awareness in partnership with Weave. That project also included a series of trauma informed creative workshops led by my collaborator as well as a community paint day at the local farmers market.

As a muralist, I want to emphasize that public art is more powerful than just beautifying a space. This work creates access, paid artist opportunities, community engagement, increased foot traffic benefiting local business, and awareness to the nonprofit supporting survivors of domestic violence and sex trafficking. Projects through grants like these help sustain the creative ecosystem that is essential to California's identity, public health and economic well-being. I respectfully ask that you support assembly member Chris Rogers request to increase the California Art Council budget to $50,000,000 for grant making.

Thank you for your time.

Before you leave, where is your mural in Sacramento?

This particular mural is on the Weave Thrift Store in Arden. You can walk up public access free, go in and purchase some really rocking clothes through Weave, support this nonprofit, support the people they support. And, yeah, you can see what artists do in our superpower.

Is it inside the the store? Outside.

Outside. Okay. Everybody gets to drive by and see it every day.

Maybe maybe Assemblymember Ward and I will drive by. We'll take We'll take a little road trip.

Pick you

up. Please do. Please do.

Well, I do remember, I think it was a Sunday member, Tasha, Burner did a cultural arts little tour, not of all of them, but several of them. So, mister chair, make a trip

out to Arden. You guys will

enjoy it. Thank you. With that, it's always a pleasure to have, the arts councils and their representatives here. It does bring us hope, and that's what we need more than ever at this time. And we thank you, and we will be closing this hearing.

And everybody have a great day.

Thank you so much. Thank you, sir.