CalChamber Priority Bills Face Fiscal Deadline Friday

(May 14, 2024) A number of California Chamber of Commerce priority bills await key action in the Legislature this week, with Friday marking the deadline for fiscal committees to send legislation to their house Floor.

While Friday is the official deadline, fiscal committee hearings will take place on Thursday. Bills must pass out of the Senate and Assembly Appropriations committees in order to keep moving through the legislative process.

Job Killer Bills

Among the job killer bills awaiting action are:

  • AB 2200 (Kalra; D-San Jose): Forces all Californians into a new untested state government health plan, with no ability to opt out while eliminating Medicare for California seniors and increasing taxes at least $250 billion a year on workers, income, jobs, goods and services.

Prior single-payer fiscal analyses estimated that the system would cost more than $400 billion annually. In 2008, the Legislative Analyst’s Office (LAO) analyzed the cost of a single-payer system in California and concluded that more than $210 billion would be needed in the first year to sustain such a system and would increase up to $250 billion in subsequent years.

Even with a 12% payroll tax paid both by employers and employees under that measure, the report predicted a net shortfall of $42 billion in its first full year of implementation and even higher thereafter. Just to cover the shortfall, a 16% tax on employers and employees was estimated by the LAO, resulting in a multi-billion-dollar-tax increase on Californians.

The kinds of tax increases needed to finance AB 2200 would detrimentally impact California businesses and certainly discourage companies from growing or relocating here.

  • AB 2499 (Schiavo; D-Chatsworth): Significantly expands 12-week leave related to crimes and lowers threshold of applicability to employers with just five employees.

In a recent letter to legislators, the CalChamber explained that while one new leave expansion may not seem like much in isolation, it is important to view this proposal as part of the broader set of mandates to which employers are subject, especially our smallest employers. In just the last four years, California employers have been subject to nine new and/or expanded leave mandates.

The CalChamber underscored that some aspects of AB 2499 are duplicative and unnecessary as it expands a 12-week leave mandate to cover scenarios addressed under existing leave laws or where there is no urgency.

  • AB 2751 (Haney; D-San Francisco): Prohibits any employee working for an employer of any size from contacting another employee outside of their normal work hours except in very narrow circumstances and would subject employer to costly litigation for any dispute as to whether the communication was permissible.

This blanket rule is a step backwards for workplace flexibility. It fails to consider California’s longstanding laws regarding hours worked and exempt employees, and fails to account for the uniqueness of different industries and professions, the CalChamber said in a letter to legislators.

According to the Energy Information Administration (EIA), California consumed more than 500,000 barrels of petroleum in 2022, which is within the covered period, and that figure exceeded 600,000 barrels in 2019. Imposing what amounts to a tax on businesses that are simply fulfilling demand for a commodity such as petroleum is impractical, the CalChamber told legislators in a recent letter.

“SB 1497 will lead to job losses and economic instability, and these added costs will only discourage further investment in the state’s economy,” it warned.

  • SB 903 (Skinner; D-Berkeley): Prohibits the use of per- and polyfluorinated substances (PFAS) in all commercial and consumer products by 2032 unless the California Department of Toxic Substances Control (DTSC) is petitioned and makes an affirmative determination that the PFAS in a particular product is an unavoidable use. Because of the breadth and scope of PFAS use, including in aerospace, lithium ion batteries, medical devices, automotive and semiconductors, to name a few, the regulatory program established is unworkable and ultimately will lead to a ban on critically important products or otherwise make certain products less safe.

In a letter sent to legislators last week, the CalChamber warned that the proposed regulatory framework in SB 903 is destined to fail.

“It will result in hundreds of thousands of product petitions inevitably inundating DTSC, creating a decades-long or more backlog of pending petitions that the agency is severely under resourced and understaffed to process, resulting in the ban on tens of thousands of essential products here in California,” the CalChamber said. “The fiscal impacts to implement this flawed regulatory program will be enormous at a time when California is facing record budget deficits.”