Assembly Standing Committee on Arts, Entertainment, Sports, and Tourism

Well, good morning. Everyone is in good spirits this morning. I wanna welcome you to the hearing. Welcome you to today's hearing on the Assembly Committee on Arts, Entertainment, Sports, and Tourism. Any absent members should make their way to Room 444 of the state capitol.

We have seven items on our agenda today with three of those being ACRs that are proposed for consent. As always, each bill will have up to two main witnesses, in support and opposition, and each witness will receive up to two minutes to present. For those that are still wishing to do so, written testimony can, of course, be, submitted through the committee's position portal on our website.

And for those attending in person, a quick reminder that conduct which disrupts, disturbs, or otherwise impedes the orderly conduct of this hearing is prohibited. I wanna thank you.

And with that, we have our first Senate author. I'd like to invite Senator Cabaldon up here to be able to present SB 226. We are gonna work as a subcommittee. I think we are one shy of quorum, but in the meantime, the floor is yours.

Thank you so much, Mr. Chair, members of the committee. I'm here to present SB 266, which makes a straightforward but important clarification to the existing law regarding infrastructure revitalization financing districts by clarifying that entertainment and sports facilities are included in the law. They're not currently barred from the law, but it's not clear. These districts allow local communities to fund major infrastructure development projects using the new tax revenue that the projects on them will generate without drawing on the general fund or burdening existing taxpayers.

And when a community is putting together a revitalization project that has the potential to dramatically increase both economic development and, ultimately, tax revenue for itself and for other overlapping local agencies and, of course, for the state, these investments make a great deal of sense.

SB 226 creates the certainty that is needed for those to work by simply clarifying that sports and entertainment facilities are included in the existing IRFD law and removing any of the ambiguities so the local agencies can move forward with some confidence. Now, this is not just an abstract idea.

California is preparing to submit a single bid for the Major League Baseball expansion team that the league has announced they will be considering, two in the country, one in each half of the country.

And the city of West Sacramento is pursuing that franchise, along with its regional partners, anchored by a new ballpark and waterfront mixed-use development. This is an area I've been involved in for a long time. If you've been to the Ace game, this is the facility I helped, as mayor, to architect the financing and construction strategy for. We were also involved in the regional efforts to build the arena for the Kings.

And so we have a lot of experience in this space.

I also was the Assembly staffer working for the member who got this initial law passed for Treasure Island development in San Francisco. IRFDs are not a common instrument. For most situations, they don't work for just regular economic development. But for projects like this that have very substantial turnaround potential, both because of the tax increment mechanism itself, but also because of the underlying property values that are an artifact of the history of disinvestment and poverty in communities like mine.

I mean, in this particular instance, this is a mechanism that can be quite powerful in making California's bid for the MLB a reality.

And so this carries statewide significance, and with one California team now departing for Las Vegas, this effort would allow our state to maintain its current number of MLB franchises, including here in Northern California. So with that, I would respectfully ask for your aye vote and introduce our witness on the bill today, who is the city manager of the city of West Sacramento and the former president of the California Association of Local Economic Development, Aaron Laurel.

Thank you, Senator Cabaldon, and good morning, Chair, members of the committee. Senator Cabaldon gave a great overview there. I don't have a whole lot to add, but I do want to underscore a couple of points about some of the details around this funding mechanism. So first and foremost, it only is used in projects where the money is generated by the project. So in other words, there's no outside property tax funding coming into this.

There's no risk to our general fund. In this case, it would be a stadium and surrounding development, and the property tax increment, only the city's portion, mind you, would be put back into the deal to help with the financing cost of the stadium. On that note, I also just want to emphasize that none of the other taxing entities that are receiving property tax from the development would be impacted. So that includes the school districts.

The county can only participate if they voluntarily do so. So we're only talking about the city's portion of the tax, and that's a very important distinction here, because in other forms of tax increment from the past, like redevelopment, that wasn't the case. So it's very much a local tool for projects such as this. So we're really excited about this opportunity to pursue a major league expansion in the Sacramento region and particularly in West Sacramento's Bridge District.

The submitter kind of gave the history on the meaning of that to us. The Bridge District is bigger than just baseball. It's a very vibrant, sustainable, infill community, and we're very excited by the prospect of the stadium coming in to help accelerate and really amplify the work that we've already been doing for the past couple decades. So I'm here to answer any questions you have. And with that, I'll respectfully request your aye vote and thank Senator Cabaldon, my former boss, for carrying the bill for us. Thank you.

Great. Thank you. Great to have you. Are there any other members of the public here wishing to register a position of support?

Thank you. Good morning, Ross Buckley on behalf of the city of Sacramento in support.

Thank you. And seeing no other members of the public wishing to approach the microphone, are there any primary witnesses in opposition? We have none on file. Okay. Seeing none, any members of the public wishing to register a position of opposition?

Okay. Seeing none, we'll turn this back to committee members for questions or comment. Again, we're operating as a subcommittee. Assemblymember Ortega.

I'll move the motion when appropriate, but I do want to thank the Senator for bringing this bill forward. I won't hold it against you for mentioning the Oakland A's, formerly known as the Oakland A's. As in my previous life, I actually worked very hard with the city of Oakland in trying to maintain the A's in the city, and remember having to, you know, maneuver all the infrastructure, all the pieces to make it happen. Unfortunately, they have chosen to leave the state.

And so I'm, you know, happy to support your bill today and look forward to what's to come. Thank you.

Thank you. Any other member questions or comments? Okay. Seeing none, Senator, I want to thank you for bringing this bill forward. You're a champion for this region, certainly your home city of West Sacramento.

And, you know, I think your history of working on these kinds of projects and the legacy that you're leaving already, to date, and I think your vision for what you have going forward is, you know, going to be more than most of us in elected office would ever be able to achieve.

I did have just a couple of, like, kind of technical questions around this, because, one, I wanted to understand, and maybe this will come before the local government committee and we can dig a little bit deeper, your proposed use of the IRFD as opposed to an EIFD structure. IRFDs, of course, have a little bit of a higher barrier with local approval to be able to establish.

And so why are we choosing this method? What would be a more beneficial method to this structure as opposed to using our EIFDs to be able to accomplish the same?

Thank you, Mr. Chair. I'm glad you asked, because the city and the Bridge District were the very first EIFD in California. So there's an existing EIFD that's overlaid over this district and most of the city already for the more generalized purposes of infrastructure development and for the development that's already occurred in the Bridge District. And so these will work together. You are absolutely correct.

This is a more difficult instrument to use, which is why very few have done so.

That's right.

But on top of the EIFD, in order to, because we're not disturbing that, those are for infrastructure projects throughout the district and the city and already have bonds associated with them. This would be on top of that district.

Got it. Walk me through, if you can. Let's say this is established, and now this is a vehicle that can be used for the financing, a financing mechanism or part of a financing mechanism, for that kind of a new project. One of the things that I know we will get hit on sometimes as a legislature is the idea that we've got something that is really meant for beneficial public uses. Right?

And that really is already existing law under the section when you think about your roads, your infrastructure, your stormwater maintenance, parks, libraries, yada yada. And then now we're going to add in here, although there already is existing law here that private, commercial, and industrial spaces can be used, so I appreciate this as clarification.

So you've got a mechanism that, while it's limited to that parcel and is generating new tax increment over time and into the future, is going to be able to repay that development of that parcel as well. Meanwhile, we have other sports facilities, SoFi comes to mind, that were 100% purely privately financed. And so how do we counter the argument that we're using a tool that's meant for public benefit, but the tax increment and the future benefit is going toward a private sports facility?

Great, great question. And, like you, I was around during the end of redevelopment, and the abuse of redevelopment by a couple of jurisdictions, a couple of whom were dealing with sports facilities, sure, is one of the reasons why public and state government confidence in that tool dissipated. So it's a really important question. The stadium that is there today was financed without that kind of investment.

But what's important to remember is that for both kinds of districts, EIFDs and IRFDs, we're talking about investments in the infrastructure.

The Irwindale project for the Raiders, I think it was, or similar projects where essentially they're trying to figure out how to subsidize directly the development itself, basically write a check to the sports team or to the stadium developer.

These resources are for the infrastructure associated with the project, and so they are to the benefit of the overall community because they are the sidewalks, the roads, the, you know, in the case of the existing stadium, it was on septic before sewer systems and whatever, which then provided the platform for all other amenities and steps forward for the communities also.

I think that's really the key answer with respect to what are we doing for the larger community. The other is that in this particular case, this is absolutely not an old redevelopment strategy where you'd say, hey, we're going to declare an area for tax increment financing, and we'll make some investments and then, you know, cross our fingers.

This one's specifically tied exclusively to this project. And so if there's no project, there's no district. And if there is a project, then the direct economic benefit, to not just the community through the availability of the facility and all the ancillary things that will occur, but it will also boost the tax revenue for every other taxing district in the region, for medical and mental health, for community colleges, and for everything else that are in the district.

None of which would be available if the project didn't move forward. So in this case, the benefits are to the community itself, as opposed to a payoff to some owner, you know, five states away.

Right. No. I appreciate that. And I think that's going to be important to underscore as that conversation continues, because you're right. There will be substantial economic benefits to the public for that kind of a new facility and that new economic driver to be able to be in existence right now, but you've got to lay down that infrastructure.

And I think it's important there to underscore, one, the infrastructure component here that will serve multiple purposes, you know, beyond the facility itself, but the broader community. And two, that, as you said, you know, this is coming out of the city share, and we're not going to be able to affect the county or school districts or others that are getting from that. At this time, we do have a quorum. I'm going to ask Madam Secretary to call the roll.

[Roll Call]

Thank you. We do have a quorum. We have a motion that I'll accept by Assemblymember Ortega. Is there a second? Second. And a second by Mr. Zbur. Well, I appreciate the proposal you have.

It's well thought. I think it'll serve a great purpose, and hopefully the Sacramento region will not be the last to be able to use this new opportunity. With that, this enjoys the aye recommendation. Madam Secretary, please call the roll.

[Roll Call]

That has six votes. It will be out. We'll hold the roll open for absent members. Thank you. Thank you.

And we are waiting additional Senate authors, so we only get on with our mornings. I appreciate those that got here just a little bit early so we can be effective with our day. Members, at this time, I'd be happy to entertain a motion on the consent calendar. There are three ECRs, items one, two, and three, moved by Ortega and seconded by Assembly member Elhawary. Madam secretary, please call the roll.

[Roll Call]

Consent calendar has seven votes. It will be adopted, and we'll hold the roll up and for absent members. Sure. While we're waiting, Mister Gonzales, we'll go ahead and open the role for item four, SB 226. Madam secretary, please call the role.

[Roll Call]

SB226 current roll, call is 7-0. We'll hold the roll open for absent members.

Alright. We have our next Senate author, Senator Ashby. You have two bills before this committee. I'll let you choose which one you wanna begin with.

It's your pleasure, Chair? Tell me

It is sincerely your choice. You have SB865 or 1050.

Okay. Get them both out here. Oh, hi. I guess I'll do this one.

Okay. They'll choose for you.

Hi, Mike. How are you? ...

Okay. Well, good morning, colleagues. Bright and early. Happy to see you.

Chair, okay to start? Alright. Great. We are here to talk about music festivals. Really fun and important topic.

Music festivals have a profound economic impact in in Sacramento, and I know abroad we call this the creative economy. So this is me trying really hard to make sure that the state of California continues to be the leader in the creative economy in this country. These music festivals that we all love and enjoy, they attract thousands of visitors every year. They generate millions of dollars in economic activity. They create jobs and contribute significant tax revenue that bolsters the local economies as well.

In the Sacramento region alone and I love to look at your staff's faces here because they usually know more than you about these particular events, but we have Aftershock and Golden Sky, which are two music festivals that are really large and they're in a park, Discovery Park. They generated in economic impact over $44,000,000 for Sacramento. These festivals supported 13,000 jobs, generated $230,000 in just local sales tax revenue alone, and 1,100,000 in state sales tax contributions. That's just one city with two music festivals.

Imagine the impact across the entire state for all of these festivals.

However, music festivals have an extremely high production cost, such as safety and sanitation and staff services. They have to improve the space before they can come in and then put it back the way it was when they leave, not to mention pay all of those artists. Big upfront costs. SB 865 is intended to make sure that the creative economy continues to infuse all of our districts and, ultimately, our lives and our communities' lives.

SB 865 has received bipartisan support as it's moved through the legislature to this point and has not received any opposition.

The goal here is to create a source that supports this economic development and this really important creative economy engine in each of our districts. And I have with me some incredible witnesses that I'm very excited for you to meet, ask them all the hard questions. Right next to me is my very good friend, Mike Testa. Mike is the president and CEO of VISIT Sacramento. So he recruits all the cool fun stuff.

You may have heard of the bridge dinner. That is a great example of his work. And Michael talked to you a little bit about the economic impact of music festivals for not only our region, but across the state. And then also is, Dylan Welsh is with us. Dylan's the senior director of legal affairs for Danny Wimmer Presents, which lest you think I was only focused on Sacramento.

Aftershock and Golden Sky are presented by Danny Miller, which is a Los Angeles based company. So this is this is everybody. This is all of us. I'm very excited for you to get to hear from them today, Mister Chair.

Thank you. Welcome to our witnesses. You have two minutes each.

Good morning. As the Senator said, Mike Testa, president and CEO of VISIT Sacramento, I often tell people that if music festivals were easy, everybody would do it. The reality is that every year offers multiple ways for these events to fail. From poor ticket sales to a 100 and plus degree temperatures, smoke from wildfires that impacts a singer's ability to sing to other elements that the organizer has no control of.

The cost of losing these events, not only for Sacramento, but for the state of California, is significant.

From a financial standpoint, destination music festivals are vital to our economy in Sacramento, by driving impact to local businesses, creating, jobs as the Senator said, and millions of dollars in tax revenues for the city and the county. But of equal importance is that these events generate significant revenues for the state of California, south of $1,000,000, per festival. Close to 13,000 jobs are created over the month long build time in activation. You know, the promoter takes a 100% of the risk for these events.

And there's no way of knowing if ticket sales will be off this year, if they'll be better this year, again, if there's wildfires, things that impact.

The reality is if the promoter loses a bunch of money, the city, the county, and the state still make all of theirs. There is no risk to any of of these partners for these events. The promoter takes a 100% of the risk. You know, Golden Sky, we had it for three years. It left after the third year because it just didn't pencil for the promoter.

We're bringing it back next year, and and some of that assistance is coming from Visit Sacramento. We want to invest in that because it was so valuable for this region. But there's no guarantee that that it'll be enough of what we're doing. And so we we look at those, opportunities that that we just don't wanna lose. We've lost Soul Bloom in Sacramento.

We lost the Breakaway Music Festival. Things that created jobs and provided impact. The last thing that I'll I'll say to you is Aftershock is a 165,000 person destination festival over four days. Drives $40,000,000 in economic impact. It is not branded to Sacramento.

It is not branded to California. At any point, that event could be picked up and moved to any other state because the brand is aftershock. I think it is fair for the promoter to think if the the state or the city or the region doesn't commit to me, why should I commit to them? And that's, I think, one of the things that we're facing. Thank you for the opportunity this morning.

Thank you. My name is Dylan Welsh on behalf of Danny Wimmer Presents. DWP is an independent promoter that produces destination music festivals. We're headquartered in California. 60% of our staff reside in California, We are the producers of two California festivals, Aftershock, the West Coast's largest rock festival, and golden golden sky country music festival that will return to Sacramento in 2027.

These festivals are proven economic drivers for California. A recent independent economic impact study found that Aftershock generates nearly $80,000,000 in annual economic output and $8,800,000 in tax revenue. Golden Sky represents an additional $34,000,000 in economic output and $3,700,000 in tax revenue. Producing each festival is like building a city every single year, complete with all infrastructure, staffing, safety, and public services needed to host tens of thousands of daily visitors.

To produce aftershock alone, DWP commits to $37,000,000 in expenses before opening doors and takes a 100% of the risk.

DWP remains committed to investing in California festivals, but the current model is not sustainable. For the last four years, we've seen national inflation of 3.3%, and we've and our cost to produce and operate a music festival have increased by 11% each year. We cannot pass these costs on in the ticket price, or festivals will become unaffordable to many attendees who fill hotels, support local businesses, and inject millions of dollars into our economy.

SB 865 ensures California will remain competitive in attracting and retaining major festivals. To qualify, promoters must meet significant attendance thresholds, maintain, long term agreements with host communities, support local businesses, feature local performers, and demonstrate meaningful economic impact.

SB 865 is an investment in supporting California jobs, California tourism, California businesses, and California's creative economy. Thank you for your time this morning.

Thank you. Are there other members of the public wishing to register a position of support?

Good morning. Russ Buckley on behalf of the City of Sacramento in support.

Thank you.

Mister Chair and members, Alex Torres on behalf of the National Independent Venue Association representing 650 venues and promoters, also on behalf of the California Capital Venues Coalition in strong support.

Thank you.

Thank you, Mister Chair and members. Jason Schmelzer on behalf of California Arts Advocates in strong support. Thank you.

Good morning, Chair and members. Bolidh Rajesh representing the League of California Cities in support. Thank you.

Thank you.

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

Thank you very much. Is there anybody else, who is wishing to offer a position of opposition or a statement of opposition? Seeing none, we'll turn this back to committee member questions and comments and then a motion. Mister Gonzales.

As I look at this bill, a few things automatically come to mind. 20,000,000, where are we gonna find the money for 20,000,000? But I represent a small little festival called Coachella and Stagecoach. And this October desert trip to include smaller venues that are now starting to pop up because of the influx of people, Desert Rodeo being one of them where they have a smaller venue while Stagecoach is going for more the local pieces. Just Stagecoach and Coachella bring in roughly approximately $700,000,000 to California.

A 100,000,000 of that is going just to the local economy in Indio. So the fiscal conservative in me is like, but I also look at this and say, is this worth is is the juice worth the squeeze? Right? With 700,000,000 coming into California? Absolutely.

So that's where, you know, I we were talking the other day about we gotta do the hard things. Right? It was a casual conversation. And this is one of those things where we say, yes. Let's invest because the payout of 10,000, 20,000 jobs into just in into my region, a quarter of a million people just coming into the Coachella Valley, that's where I have to say, yes, the juice is worth the squeeze.

With a 20% unemployment rate in counties like Imperial. This brings in a whole bunch of jobs. So my, my encouragement is that I want more smaller, events that can that can couple along with these larger events so that we can grow areas like Imperial County that absolutely need it, Riverside County and San Bernardino County. So these are one of the harder things where we have to say the juice is worth the squeeze. So I thank the author for this.

Thank you.

Thank you. Senator Mckinnor?

Yes. I'd also like to thank the author for this bill, and I have a little I have a lot of music in my district. I have big music and big venues, but I also have a little festival too. Called Rolling Loud.

He's yours too. Danny Wimmer's in your your area.

My area is where I love it. Like, we love music in my area. And so we have this little festival called Rolling Loud, and it brings in tons of money and tons of visitors to my area. Whenever we have people out having a good time spending money, it helps our general fund. And so it's worth the squeeze.

I'm like what you're saying. Yes. It's it's worth the squeeze. So I encourage everybody to support this bill because this will put into our general fund, and I think there is that is big business when we bring these festivals in. And so thank you for this.

Alright. With that, I'm hearing a motion from Mister Gonzales and a second from miss Mckinnor. Yes. Any other members pushing any questions or comments? Well, Senator Ashby, I wanna thank you very much for bringing this idea forward.

Of course, I know you're also working on a companion issue with regard to the budget to make sure that the money would be there. Always important that we're covering both bases. I recognize that these festivals can have a huge impact, but particularly to that local economy, for your local tourism, for the local hospitality industry. But the most important part of these smaller musical festivals, I think, that you're trying to promote is that you're giving a space for local artists to be able to

Have their have their break. And that is a great benefit to those that are just trying to sort of find themselves on the stage and hopefully get noticed and hopefully take their career and their talent elsewhere. So there are multiple wins here, and I think it's a great opportunity that we've been missing so far that that you're leading on to be able to highlight that venue and to be able to support that industry here in California for all those wins.

With that, I invite you to close, and we're happy to take a roll.

Well, thank you so much. I love this bill because it's exact this whole committee, which we don't even have this committee in the Senate, but I wish we did because the creative economy is it's literally our DNA in California. And you're right. This helps the artists. It helps the cities without bottle rock.

Napa has almost no transit occupancy. I didn't have another big event. They just have the wineries. They don't have a big event. That's their signature event.

Even in San Francisco, outside lands makes a huge difference in their creative economy. This this helps everyone, Huntington Beach, San Francisco, LA, and Sacramento. And I'm really excited to see it through. I'm so grateful. I knew this committee would get it because it's all about how we use arts to grow what's happening in the state of California.

Thank you so much. I respectfully ask for your aye vote.

Thank you, Senator. Madam secretary, please call the roll.

SB 865. The motion is do passed the Assembly committee on appropriations. [Roll Call]

Right now, the rule's at eight zero. That will be out, and we'll hold the rule up for some members.

Thank you

Thank you.

so much. Thank you. We'll exchange out your witnesses and When you're ready, you can go ahead and begin your presentation on SB 1050 item number 6.

Hi. Thank you, Mister Chair. Thank you so much. This is Home to the largest and most influential creative sector in the world.

We wanna keep it that way. Over 750,000 jobs power the state's creative economy, which generates over 190,000,000,000 federal, state, and local dollars. Recent advancements in artificial intelligence have led to the creation of synthetic performers, human like digital figures that convincingly appear and speak and move and perform like real people. The use of these performers in advertisements is misleading. It's misleading to consumers and allows creators to avoid the responsibility of hiring real workers.

Over seventy five percent of adults in The US say steps should be taken to regulate AI altered content. With the evolution of AI and its impact on commercial media, California really must ensure that existing advertising laws are updated to reflect new realities. SB 1050 does this by requiring disclosures. When a synthetic person is depicted in an advertisement.

The bill is sponsored by SAG AFTRA and supported by the California Federation of Labor Unions, Common Sense Media, and the National Association of Voice Actors amongst many, many other supporters.

With me to testify today is Shane Guzman representing SAG AFTRA and the Teamsters, and Tim Freelander who's president of the National Association of Voice Actors.

Thank you. Welcome. You have two minutes each.

Thank you. Good morning, Mister Chair, member Shane Guzman, on behalf of SAG AFTRA, proud sponsor of this bill, and also the Teamsters who are Hollywood local supports this bill. AB 1050 provides for a basic disclosure when an advertiser use utilizes synthetic performers. This is not a new concept. We've had disclosure requirements for many years.

The bill is about protecting consumers by ensuring that they have adequate notice and that the image or voice trying to convince them to buy a a product or service is not a real human being. The bill is also about protecting the artist SAG AFTRA represents. Our view is the the replacement of human actors with computer generated synthetics, perhaps trained on stolen performances, jeopardizes jobs and devalues human artistry. Consumers deserve to know when that occurs.

Lastly, we have taken significant amendments to try to mitigate the concerns of the opponents.

We will continue to work through this process over the next committee and through the summer to try to get there if we can, but we need to make sure that we don't undermine the intent of this bill. It needs to work. And with that, I respectfully ask for your aye vote.

Thank you.

Good morning, everybody. Thank you for having me here today. My name is Tim Friedlander. I'm a professional voice actor, small business owner, proud SAG AFTRA member. I'm one of the cofounders of the Creators Coalition on AI and the cofounder of the National Association of Voice Actors, where we have over 1,700 professional voice actors across California and across this country.

I'm here today because consumers have a right to know when the person selling them something isn't a person at all. The use of an unlabeled synthetic in a video or audio commercial is by its very nature untrue and deceptive. When a real performer appears in a commercial either on screen or behind a microphone, they bring something unique, authentic human experience, but also accountability. When an AI generated likeness or voice replaces that performer without disclosure, consumers are being misled.

They are forming trust and making purchasing decisions based on a performance they believe was done by a human.

The audio only industry is massive, with the podcast industry itself projected to be worth $17,000,000,000 by 2030. California residents are in the top two consumers of podcasts in this country with over 90% of them listening on their smartphones on the go. These audio only listeners have no idea if they're listening to a human or synthetic voice. And this is not hypothetical. AI tools are already being used to clone voices and replicate real performance in commercials, sometimes without their consent and almost always without consumer awareness.

In a sign of things to come, over 100 stations in a nationwide radio network replaced every voice actor, every voice talent with AI generated voices. California has long led the nation in protecting performer and consumer rights. Labeling AI generated commercials is the next logical step. Disclosure doesn't stifle innovation. It builds the trust that makes innovation sustainable.

Financial, legal, medical, and political advertisers know this. Audiences deserve transparency, and just like their food, deserve the right to know if what they are ingesting is real or synthetic. Now I urge your support today on Senator Ashley 's Bill, SB 1050. Thank you so much.

Thank you for being here. You are indeed a very good professional voice actor.

Everywhere-

there other members of the public here wishing to register a statement of support?

Mister Chair member, Sarah Flock, California Federation of Labor Unions in support. Thank you.

Good morning. Dagny Starin on behalf of Common Sense Media and the Music Artist Coalition in support.

Thank you very much. Okay. We do have registered opposition on file. Are there two up to two primary witnesses wishing to offer a statement of opposition?

Thank you very much. Okay. We do have registered opposition on file. Are there two up to two primary witnesses wishing to offer a statement of opposition?

Thank you, and you'll have up to two minutes at each as well.

If I go first. Yeah. There you go.

Good morning, Chair members. My name is Robert Boykin with TechNet here today to respectfully oppose SB 1050, listed as amended. I would appreciate the author's goal of promoting transparency and agree consumer should not be misled. Our concerns are about ensuring the bill is targeted, workable, and aligned with existing law. First, materiality.

As drafted, we still feel the bill requires a label anytime a synthetic performer appears, even as a dental background or obviously stylized use that no reasonable consumer would find deceptive. California advertising law has always tied disclosure to risk of material deception, and we're simply asking this bill to do the same. With that anchor, the recent removal of the word prominently means disclosures get attached to the content that conveys nothing useful. And when labels appear everywhere, consumers learn to ignore the ones that actually matter.

Second, common sense carve outs.

The bill should exempt accessibility features, AI captioning, audio description, sign language overlays that serve customers with disabilities and pose no deception risk, and it should exempt purely illustrative or thematic figures that no claim that make no claim about the product. Third, fair enforcement. Right now, a single and inadvertent error is enforceable under the UCL through private litigation with uncapped per impression penalties. We're asking for these standard guardrails, a right to cure, a good face safe harbor, and a reasonable penalty cap.

So businesses working hard to comply are treated like aren't treated like bad actors.

These are neurotechnical fixes that can help focus the bill where consumers consumer protection is generally at stake. We look forward to continue to work with the author, this committee, and the subsequent committees going forward. Thank you.

Thank you.

Thanks. And my colleague Robert is due in another committee and that's why he expeditiously ran through his testimony. So thank you very much. Chair Ward, vice Chair Lackey, members of the committee, my name is Melissa Ptak. I'm here with the Motion Picture Association.

Thank you for the opportunity to testify today. We appreciate the ongoing conversations we've had with the author and the sponsor and the the the committee consultant here. We continue to object to the bill for two main reasons. First, SB 1050 omits the element of deception and requires a disclosure whether or not a consumer would be misled.

The bill limits commercial speech, and any restriction must directly and materially advance a substantial government interest and must not must not be more extensive than it is necessary to further that government interest.

SB 1050 requires labeling of all ads that use synthetic performers and not just those which are misleading, making the bill's restrictions on speech too broad. Second, we are concerned that the private right of action will be an invitation to litigation against companies that are perceived as deep pocketed. We request that the enforcement remain with the attorney general and other public prosecutors. The recent amendments raise additional concerns. The bill now requires disclosure where synthetic performer is used in an audio advertisement.

A disclosure in an audio advertisement will propose operational challenges, particularly for extremely short advertisements. The new amendment limiting disclosure where the synthetic performer appears prominently needs some clarification. Those producing ads will need more specificity. For example, is a stadium full of people prominent because it's large? It's a large number of people and may take up a large part of the screen?

What if the ad also features human actors in the foreground who are the primary focus of the ad? Would such an ad be outside the scope of the disclosure requirement? We note that SB 1050 differs significantly from the New York law, which recent recently became effective, specifically the private right of action and the inclusion of audio ads are not in the New York law.

While we understand California has no obligation to mirror another state's law, it is very challenging for our member companies to establish business practices which comply with state laws that have different standards. We look forward to continuing to work with the author and the sponsor about the remaining issues.

Thank you very much for the opportunity to be here.

Thank you for being here. Are there other members of the public wishing to register a position of opposition?

Hi, Chair. Chris Bollinger, behalf of Cal Broadband. Very, very respectfully opposed unless amended. Thank you. Thank you.

Mister Chair and member, Peter Kallesen on behalf of the California Broadcasters Association. We've been working with the author's office on the audio only as it pertains to broadcast. Specifically, local public broadcast is unique in that it has no visual component. It can't provide disclosure while simultaneously delivering the message because local broadcast does run-in fifteen to thirty second increments. The impact on local broadcast is disproportionate, and we wanna continue working with the author's office.

So thank you.

Thank you.

Good morning, Chair and members. Naomi Pajar on behalf of the Computer and Communications Industry Association. We have an oppose unless amended position. Would align our comments with TechNet. Thank you.

Thank you.

Laura Bennett, on behalf of the California Chamber of Commerce, oppose less amended. This is very tall. I'm not supposed

to touch the microphone.

It says don't touch the microphone.

Touch the microphone.

Opposed less amended. We align our comments with TechNet. Thank you.

Thank you for being here. Alright. Seeing no other members of the public wishing to have a position, we'll turn this to committee members for questions, comments. Miss McKenna.

Yes. Again, thank the author for doing the bill.

You know,

for me, I'd like to know if it's an AI ad. We do ads for campaigns. And at the end of the ads, we say it real quickly, pay for by Tina McKenney and blah blah blah blah

blah blah blah. Quick quick. So if it's a thirty second ad, I would

love to know. Or if it's a program I'm watching and I'm listening to on my on my iPhone, I love at the end of it to say AI generated. That takes one second. AI generated. That way people know it's not real people because it may not be deceptive.

The message may not be deceptive, but people don't know whether they're hearing a real live person or a AI generated person or even when they see the images as well. And so it would be great for people in the public to just know that this is AI.

And so with that,

I will support the bill.

Thank you, Mister Kenerson. Member Zaver.

I wanna thank the author for bringing the bill. You know, I think this set of issues is actually one of the most important that we're dealing with now with the advancement of AI. And it really is important that we protect our workers and we make sure that, basically, folks that are in these creative spaces, that they're not being displaced in an unnecessary way.

On the other side of that, obviously, we wanna do things in a way so that the creativity of the industry is maintained and doing that in order to protect the workers in the state of California. So I think that's the balance that these things obviously, supporting this bill today.

And so I think really, you know, I just wanna thank you and, and encourage you to continue working with the opposition. I think there's some details there. Obviously, when we're talking about commercial speech, there's constitutional issues, that arise, in terms of what the standards are. And so I do think some additional focus on that would be good. The issue of sort of the prominence, I think, should be a little more defined.

So a case where, for example, you might have a stadium full of folks with with real you know, with with, you know, with JLo or, you know, some other artists there, does that require if if the if the stadium is full of reproduced people, but you actually have your artist there and that person is real, what would the disclosure be there?

So I think so those kinds of issues are ones that we have to think about both protecting the real artist, but also allowing for the creativity to continue. So, you know, some of these are issues I think are more appropriate for the Judiciary Committee and, but, you know, I'm glad that the two sides are working together.

Obviously, this is a you know, the this industry is one of the most important in my district, and it's important that we get it right both to make sure that it survives challenge, so to protect these workers and also to protect the workers and the creativity in the industry. So with that, I'll be supporting the bill today.

Thank you, missus Zabirsa. Member Quirk Silva.

Well, I'm glad you brought up, J Lo, considering you're sitting between, two Latinas, and we know she would take up all the space, so we wouldn't have to wonder about, the people behind her. But this bill is important not only at this time, but if we back up several years. So several years ago, I was Chair of arts and entertainment. And this is when we were just beginning to say out loud AI.

And the public of who is not working in the industry is trying to catch up to what the industry is doing, and yet it has moved extremely quickly.

So when I was Chair of AI, I actually distinctively remember being on a tour of Capitol Records, And they were just starting to talk about what they could see as far as what AI would bring and not only the positives, but, of course, the negatives. And we are living that. We are seeing that each one of us when we pick up our phones and we're scrolling because we all do, so let's all own that. And there are times when we go, okay. That's AI for sure.

But then there's other times where it's kind of is this AI? And I think that's what the public is thinking about many times. And then, of course, when you look at the creative arts, there as my colleague just mentioned, there there's probably still work to do on this particular bill, but the the concept and the idea of protecting workers and in this case, voices, sometimes voices that you don't even see, related to podcasts and journalism and so forth, those are important conversations.

So I will be saying yes today. I do think there's more work to, to do, But it is the topic of our lifetime for many of us because it isn't just AI.

We could broaden that to what we talk about many times all day long, which is social media and influence and all of these things. But it's a changing industry, and it's impacting, not only just actors, but the entire creative of what are we gonna be looking at if you wanna go out and project ten years from now because it has moved so fast just in our short I think I was a Chair and oh, no. Don't

when? '23.

'23. Okay. So '23. And that's how fast when they were just starting to talk about it. So with that, thank you for your work.

I'll be

Supporting it today.

Thank you.

Thank you, miss Quirk Silva. Vice Chair Lackey.

Yeah. I think everybody wants to know the distinction between techno talent and human talent. And I think we deserve to all know the know the difference. I mean, our voice witness has such an impressive voice resonance. I wonder if he was lip syncing over there.

It it was quite impressive. But I I think that a a AI is not the enemy. It's not toxic in and among itself, but I think we want to know the distinction. And I think we deserve to know the distinction. And so I think as we continue along this line, we we shouldn't characterize AI as the enemy.

But because AI can be a friend, but it it will be the enemy if we let it. So I think this is a a bill that recognizes the need to make the distinction between the two of them, and I I don't think it's anti AI. I think it's just something that we all want to know. So I clearly will be supporting this.

Thank you, Mister Lackey. Assemblywoman Eliwari.

Thank you so much to the author, for bringing this forward. I think it's really important, to recognize how many folks are able to get their start in this industry. Aye, am working on a bill specifically because we know that as people are coming home from incarceration, they get an opportunity, to really uplift, themselves through what we know is a huge part of the creative economy in state. And we have to do everything we can to protect all the workers in this industry.

And that means at every level, no matter what it is.

And I think hearing your voice, like, I almost feel like I've heard a synthetic version of it too. You know? And how unfair is that that you've done all this work and now someone can just steal it and use it in this way? And so, just really appreciate you coming today. Appreciate, the opposition's perspective, but I think everything we can do to protect workers is is really, I think, important in this case.

Thank you. Any other member questions or comments? Well, Senator, I really sorry. Motion by McKinnon and a second by miss miss Quirkzilla. And, sir, Ashby, I wanna thank you for bringing this forward.

Of course, congratulations on a triple refer opportunity for you, and this is the second stop for you. I had a chance, of course, hear this in the privacy consumer protection committee. We're passed out of that, and we'll be headed to judiciary.

And I know that you are working on some technical amendments that, of course, are not gonna undercut the principles of the bill that we wanna do, but are gonna make this implement the right way because I think what you're hearing, kind of the common thread here as much of what I agree with us specifically would align with what Mister Zibur and our vice Chair had been able to say.

Yes, we wanna get some of those technical amendments right better, I think, done in judiciary, which is your next stop when we think about the how to how to more specifically define what a prominently fit featured synthetic performer is, working on the impact of local news broad broadcast and audio only commercials.

And, you know, you're taking that laundry list of, like, all the and and figuring out with opposition Yeah. You know, what is reasonable to be able to meet, and I know that that work will continue as well.

I think that is important that as we're considering these, just as the legislature has done in the past, to be able to recognize the work of music artists and when their talent when their inputs are going to something and being recreated, and then now we're using, you know, technology to be able to create something that is a likeness of them. I mean, we're all, like, you know, thinking about how AI is coming into these different industries and and into our different lives.

But this bill clearly just being about, you know, a, kind of a a viewer's, understanding, and the deception that can come with that, I think is important.

It's important to the jobs that go into this that are feeding the systems that are being replicated otherwise through this technology, but also for the viewer to understand, you know, what they're looking at so that they can make a conscious decision, have a little bit more of a pause to understand the advertising, the input that's coming into them, the, the the whatever's being sold, whatever's being, like, you know, whatever's motivating them to to to know, something, that they should just have a quick little pause to understand, like, you know, sort of the the the the genesis of that.

This might be not be coming from, your, your friend, your neighbor, your your your fellow human being, but something that's being recreated, not necessarily with malintent. Right? But that's just something that you would wanna know about to be able to process, you know, the input that you're receiving from that as a viewer. So, I think it's important that we're all, working on this.

It is gonna be probably, you know, the biggest challenge coming up for us in this decade, and you're, tapping into a very important and and and very present, issue that's happening here with the industry. So with that, I invite you to close.

Well, I I really wanna say thank you for all your comments. It's actually incredible to hear about the the movement from 2023 to 2026. We know intuitively, I think, how fast this is moving, but we also it's also about just telling the truth, you know, making sure people have the facts, and then they can decide what they wanna do if they wanna listen to something or not, and and protecting the hard work and investment that people have put into their own talent.

And my commitment to all of you is I I wanna get it right. So we'll keep working with the opposition.

We've taken many, many amends, but we'll keep doing more. I I'm open to all of that. I just wanna get it right. I appreciate your input. I took notes.

Please, if you think of something else even after the committee, please tell me. I'm happy to take it in. I appreciate you, and I respectfully ask for an aye vote.

Thank you, Senator. Madam secretary, please call the roll.

SB 1050, the motion is do passed to the Assembly committee on judiciary. Ward? Aye. Ward, Aye. Lackey?

Aye. Lackey, Aye. El Hawari. Jeff Gonzales?

Aye.

Jeff Gonzales, Aye. McKenner? McKenner, Aye. Ortega? Aye.

Ortega, Aye. Quirk Silva? Aye. Quirk Silva, Aye. Valencia?

Yes. Valencia, Aye. Aye.

Thank you. That bill has eight votes. It will be out. We'll hold the roll open for absent members.

Thank you so much.

Thank you for being here, and we will be on to our final item of the morning, item seven.

We'll let the presentation table reset and invite Senator Small Cuevas up here to present SB 1073. Good morning. And when you're ready, you may begin.

Thank you, Mister Chair and colleagues. I am proud to present SB 1073, which provides California taxpayers a voluntary opportunity to support the preservation and long term sustainability of one of not one of, the first California black cultural historic district. My district is South Central Los Angeles. It is home to one of the largest black populations in the nation. It has a long history of being the center of black culture, black history, black pop culture, arts, entertainment, and community.

And what is so historically significant about this district is that it spans both the multigenerational artistic and civic contributions that have helped to shape Los Angeles and the state for generations. Notable landmarks like the Los Angeles More Memorial Coliseum, which hosted the nineteen thirty two and eighty four Olympic games, is standing next to the California African American Museum, which is the first museum in the nation to recognize the black experience.

This historic South Los Angeles black cultural district lifts up legendary cultural centers like the Crenshaw Corridor, Leimert Park, Central Avenue, where murals and public art reflect a deeply rooted tradition of creativity, activism, and cultural expression. At this time, where we know there is national hostility against diversity, equity, and inclusion, against groups of color, against cultural contributions and individual expressions, it is incredibly important that we look for ways to fortify, sustain, and protect these cultural assets.

And that is why SB 1073 is so important because this bill allows Californians to make voluntary contributions through their personal income tax returns directly to support historic South LA.

This is a tradition of self determination, and, certainly, this is not in any way meant to give the state a pass or off the hook for investing and protecting cultural corridors and assets across the state. But this is just another tool in the toolbox as we are looking at, outlay years of deficit. It's incredibly important that we do all that we can to preserve these institutions. And this means that we're asking Californians to get involved, to volunteer.

This is a chance for residents to give their voice to protect their assets and communities.

And with that, I respectfully ask for your aye vote.

Thank you, ma'am. Senator Small Cuevas, do you have any witnesses in support today?

No witnesses today.

That's all well and good. Any other members of the public wishing to offer a position of support?

Thank you, Mister Chair and members. Jason Schmelzer on behalf of the California Arts Advocates in strong support of the bill and very pleased to be the sponsor working with miss, Senator Smallwood Cuevas.

Thank you very much.

Good morning, Jasmine Asher. I'm representing the Greater Sacramento Urban League, and we are in support. Thank you.

Thank you. Are there any members of the public here in opposition to the bill? We have no registered opposition on file. See none. We'll turn back to committee members, for questions and comments, and I'm looking at Assemblymember McKinner.

Oh, no. You were looking really happy about this. Assemblymember Elumari.

I just really wanna thank the author for all the work, that she's been doing, especially related to the Black Cultural District and just the ways in which it preserves our community, our culture, our history, and then a place like South Central that I think really deserves that as we see demographic shifting. So just wanted to uplift, the work that you're doing and definitely urge support on the bill and would like to move this bill

the bill. Thanks. Thank you, Assemblywoman Quirk Silva.

I mean, I heard this bill already and rev and tax, and, of course, supported it there. But I wanna acknowledge the author as she I think probably within a few weeks of her being elected. And again, I was Chair of arts and entertainment at that time, came to came and asked for a meeting and really voiced how can she get a cultural arts district in her city.

And at that time, there, I believe, were 14, and she wanted to not only have an additional one in her area, but others. And so, really, the how are we paying for these and supporting them came up.

So she has been very committed and I like to say slow and steady. And yet, you can see the achievements that she's already made and not any only in this voluntary kind of tax proposal, but also in just the work. And so what I would say to all the members here as somebody who is leaving shortly, it's slow and steady wins the race. I mean, you're not always gonna get 25,000,000 because you want it, but it's every year she stuck out to it.

And you can see by the analysis that she's making progress.

So very proud of you and happy to support this.

Thank you, Assemblymember Gonzalez.

Thank you, Mister Chair. Just a question for clarity for the author. Will this go on all of the tax forms throughout the state, or will it be specific for the LA region? Can you kind of talk to that? Yes.

Like, for instance, you know, again, I go back to Imperial County, Calexico. Right? Quite a distance. Does it go in theirs, or how does that look?

No. This is specific. It it goes on all tax forms, but, really, it has to be and and I think this is a great tool, not just for my cultural district, but for others who whom want to to see how to increase investment. It it still has to be a big campaign to educate the tax, payers in my district who care the most about this cultural district to know that it's on the form and how to participate.

I think the opportunity of putting it on the forms for everyone is that, you know, everyone might want to support cultural districts.

And so the more that we have that option for folks, I think the more, hopefully, we will have participation of everyone investing in cultural districts. But, this is the first opportune this is the first historic black culture district in the state. There were 14, as as our former Chair said, but not one was dedicated to the black experience in California. And so we think that it's important for us to look at different methods to sustain, to grow, and to protect this cultural district.

And, hopefully, it it's a model that other communities will be able to use as well.

So and I don't know if you could speak to this piece or not. Will it say on the form, like, when I'm checking the box. Right? Will it say LA based black cultural district, or will it say checkbox for cultural districts in general?

No. It will say the historic black South LA Cultural District.

Got it. And do you think the example I give is in Indio, we have because of the festivals, a lot of the arts and culture comes from the festival, and then we have art in public places and all kinds of other stuff. Do you think that this also opens up the door for others to then, if you will, check a box to invest in their art or invest in whatever x type of thing. As you as many know, I'm very partial to veterans issues. So, hey.

There's you know, we have a veterans thing, a veterans cemetery. Can does this open up the door for things like that, do you think?

Yes. There are already boxes for folks to check even for a cultural district. And I can't remember exactly where that cultural district is, but there is already, a box that is available to that cultural district. So this is an opportunity for any member, who may have a cultural district to put forward a piece of policy that says, you know, check this box.

Why it's specific and not just general cultural district is because it really does take quite a bit of education For taxpayers to know and to activate around the option.

And so, you know, for South LA members, we're gonna have to do a lot in South LA for folks to know to check the box. And in in your community, you will have to do a lot of work to say check this box for your community. And so it's important for folks to know specifically where the resources are going so that they can look on that form, find themselves, and then hopefully utilize the education to take action and check the box.

I I just you you know, thank you for your your advocacy and, you know, I always try and listen to the folks who've been here a little bit longer and the slow and steady model, incremental wins, so on and so forth. One of the things I like about this is that it's voluntary. So when people hear this, they're gonna hear, you know, these mandatory taxes. But it's a vol it's an opt in if you'd like.

It's an educational piece to help restore, revitalize, or enhance and and inform folks.

So I I I like that piece about that. I'm offline, I'm interested to see how that would play out in other areas with other districts, and what does that look like. But I I wanna thank the thank you for your your patience, your grace, in in putting this forward.

Thank you. And happy to work with you on that and really appreciate the Chair. She helped show me the way, and so we will continue to do this to build cultural assets across our our state. So thank you.

Thank you. Are there any other member questions or comments? Well, Senator, I wanna thank you for bringing the bill forward. You were able to invite myself and other members of the committee as well down to the South Los Angeles Black Cultural District, what, about two months ago? Give or take times a blur.

That's right. What a wonderful experience. You know, your leadership there to really highlight that, to be able to get it to be on our state's designated state cultural district list as well, and then to, you know, follow it up to be able to be able to support that.

The arts, the vitality, the food, the community, I mean, it was really wonderful from my first experience to really have that in-depth immersion in what a special space it is, a historic place that that it is, and that we need to do more as a state to be able to support wonderful cultural districts like that. I did want to I'm fully supportive of this bill moving forward, and I did want to leave you leave you with some things to think about as it moves forward.

I know this is the second step that it's going and, of course, I think you're going to appropriations and you might have time on the floor, if there's an opportunity to think about in gaming this out, how this might actually play, for mutual benefit here because I want this to be successful for the receipts that are gonna come in for the cultural district here in your home in your home district.

And you wanna be mindful as well that I think this might be a little bit of an outlier, but one that I'm willing to support when we have something that is a statewide. I think this sort of gets into Mister Gonzales' point.

A statewide resource of inputs where we want people from all over to be able to make these contributions that ultimately at the moment are gonna be able to be used as under the bill for the purposes and the benefit of South Los Angeles cultural district. But we do have other black arts districts elsewhere in the state as well that, you know, might be able to see this as an opportunity.

And so any flexibility you might be able to think about with the California Arts Council who would be administering this is just something to kind of, like, you know, put a little pin on.

And then this is wonderful because it is absolutely needed for our black community, and we wanna think about, you know, with space being limited, you know that you're gonna run up against that that that already, you know, enshrined, limit that we have, that we wouldn't want we wouldn't want this to sunset for lack of interest. Right? Because that space on that that ballot is comp is competitive. And if we don't hit that threshold in certain tax years and everything, it falls off the rules.

And so how do we get more interested in this? I think the education that you're talking about and specifically, talking to Angelenos to be able to avail themselves of this and everything will keep you above that threshold. And then your leadership here, would that spur other interests in other ways to be able to support other cultural districts here, and how does that kind of, like, get into the the competition nature of the rest of that ballot?

You know, it's it's it's something to kinda think about for future bills in future years. But you're leading the way on this, and I think it's for a righteous cause that we wanna be able to do to be able to support a a wonderful historic institution in your community.

And so I thank you for bringing this bill forward as you think about those for future considerations. With that, I invite you to close.

No. Thank you, Mister Chair. And and we are thinking about it because it is outrageous how little we invest in our arts and culture here in California. The I wanna say the originator of global arts and culture. I think we have seen other states and other countries who actually have moved ballot initiatives that create constitutional requirements for funding.

And it's something I would love to work with you and other members on, to think through what are the ways we really sustain our arts and culture and not let, you know, national hostilities, force us to step back and walk away from communities that means so much to the story of California. So I absolutely wanna work with you on that. I wanna thank everyone for their support of this bill, and I really want to recognize our Assembly member, Sharon Kwikserba, for her leadership early on.

She explained in detail how this worked and offered her support and services to help me over the years from 2023 when I first came into office. So wanna thank her for that and my good colleague from South Central LA who was there when we kicked off the Cultural District.

And, with that, I respectfully ask for your aye vote.

Thank you, sir. We have a motion in second. Madam secretary, please call the roll.

SB 1073. The motion is do passed to the Assembly committee on appropriations. Ward?

Aye.

Ward, aye. Lackey? Aye. Lackey, aye. El Hawari?

Aye. El Hawari, aye. Jeff Gonzales?

Aye.

Jeff Gonzales, Aye. McKinner. Aye. McKenna, Aye. Ortega.

Aye. Ortega, Aye. Quirk Silva. Aye. Quirk Silva, Aye.

Valencia. Yes. Valencia, Aye. Berg. Aye.

Aye.

Thank you. That's nine zero. So that bill is out. And, we will go through the role one time. I think we have all members present if you vote on everything. Enjoy the rest of your day. Madam secretary, we'll, begin from the top, beginning with the consent calendar.

[Roll Call]

The consent calendar is adopted nine zero.

[Roll Call]

That bill is out nine zero.

[Roll Call]

That bill is out nine zero.

[Roll Call]

That bill is out nine zero? We'll go back to SB 865

[Roll Call]

Now that bill is out nine zero. And we got everybody on the last one, so we are good, and we are adjourned. Thank you.