CalChamber Advocacy Stops Harmful Proposals in Fiscal Committees

Strong opposition from the California Chamber of Commerce and allied groups stopped a number of harmful proposals in Senate and Assembly fiscal committees yesterday including many bills that were top priorities for CalChamber members. 

“Yesterday was a very good day for California’s business community,” said Ben Golombek, CalChamber Chief of Staff for Policy. “CalChamber’s efforts led to several bills being abandoned or being amended significantly enough to resolve our concerns during the suspense file process. Some of yesterday’s big wins include stopping or amending down AI bills, labor-backed legislation, broadband, health care and burdensome regulatory proposals, among many others. The CalChamber team did a great job getting our message through to policy makers and making a real difference on behalf of our members.”

CalChamber Wins on Priority Bills Following Suspense File Deadline:

• AB 1757 (Kalra; D-San Jose): Defeated.

Will create further litigation abuses in California related to online website accessibility.

• AB 2239 (Bonta; D-Alameda): Defeated.

Slows Broadband Deployment. Slows down the deployment of broadband in California and will likely lead to litigation.

• AB 2374 (Haney; D-San Francisco): Defeated.

Joint Liability for Businesses of All Sizes. Originally imposed new statutory joint liability on business of any size that contracts for janitorial services if a contractor violates the Displaced Janitor Opportunity Act and placed new mandates on those businesses that should be assigned to the contractor. Job killer status removed due to May 16, 2024 amendments removing joint liability portion of the bill and making other changes. CalChamber remains opposed unless amended due to the requirement that an awarding authority must provide certain notifications to a union representing another entity’s employees. Oppose Unless Amended.

• AB 2877 (Bauer-Kahan; D-Orinda): Defeated. 

Restricting Information Available to Train AI. Amends the California Consumer Privacy Act (CCPA) to prohibit a developer, as defined, from using the personal information (PI) of a consumer less than 16 years of age, as specified, to train or “fine-tune” an AI system or service unless affirmative authorization is provided pursuant to the CCPA’s provisions providing opt-out/opt-in rights. Because another pending bill, AB 1949 would also amend the existing opt-out/opt-in rights for minors under that same provision, potentially could apply to any consumer under the age of 18. Even if authorization is received, businesses would be prohibited from using the PI of minors unless they both deidentify and aggregate the data. By limiting inputs, this bill regulates the technology itself, hamstringing developers from appropriately training the technology. Realistically, forces companies to engage in either age verification or not use any PI to train any AI. Even if they are able to age verify consumers, unintended consequences are likely significant, because access to data specific to children and teens is essential to develop tools to provide them unique support for risks and challenges specific to their age groups.

• AB 1791 (Weber; D-San Diego): Defeated.

Mandates removal of certain information from user generated content, however technology doesn’t currently exist to do so. Conflicts with other pending legislation. 

• AB 2499 (Schiavo; D-Chatsworth): Amended to remove major concerns. 

Leave Expansion: Significantly expands 12-week leave related to crimes and originally lowered threshold of applicability to employers with just five employees. Job Killer tag removed due to May 20, 2024 amendments and June 6, 2024 amendments applying leave to employers with 25 or more employees, limiting qualifying reasons for taking leave, and limiting duration of time for specific qualifying reasons. Former Job Killer 2024

• AB 2557 (Ortega; D-San Leandro): Local entity contracts. Significantly limits the ability of public entities to contract with local small businesses or non-profits.

• AB 3129 (Wood; D-Santa Rosa): Amended to remove major concerns. 

Stifles Free Market Transactions for Health Entities. Require private equity groups and hedge funds to obtain the written consent of the California Attorney General before acquiring or effecting a change of control with respect to a healthcare facility or healthcare provider group.

• SB 1446 (Smallwood-Cuevas; D-Los Angeles): Moved to Rules Committee instead of Assembly Floor.

Use of Technology in Grocery and Retail Stores. Overly prescriptive mandate regarding the use of self-checkout stations that will frustrate customers and increase costs to retailers and requires stores to notify all workers and the public any time they choose to utilize new technology.

Other Bills Stopped in Fiscal Committees

Among other CalChamber-opposed bills held in the Senate Appropriations Committee were:

• AB 560 (Bennett; D-Ventura): Groundwater Adjudication Proceedings. Imposes new requirements for courts to consult with State Water Board prior to entering a final judgment in a groundwater adjudication, raising questions about role of executive in the judiciary.
• AB 868 (Wilson; D-Suisun City): Burdens on Political Speech: Requires State’s Fair Political Practices Commission (FPPC) to set up massive new database and bureaucracy to manage and compile most digital advertisements, which can already be tracked via Secretary of State.
• AB 1588 (Wilson; D-Suisun City): Affordable Internet and Net Equality Act. Inappropriately complicates state procurement contracts rather than focus on the goal of securing more eligible Californians enroll in the Affordable Connectivity Program (ACP) to get broadband services.
• AB 2421 (Low; D-Silicon Valley): Employee-Union Agent Evidentiary Privilege. Effectively creates a new, broad evidentiary privilege in the public sector that is one-sided and will preclude relevant evidence during litigation or workplace investigations.

Among the CalChamber-opposed bills held in the Assembly Appropriations Committee were:

• SB 308 (Becker; D-Menlo Park): Carbon Dioxide Removal. Duplicates existing programs to create an added layer of compliance.
• SB 697 (Hurtado; D-Sanger): Extreme Increase to Anti-Trust Penalties. Increases certain anti-trust penalties for corporations by 100 times, despite working group on this issue being in progress and complete recommendations for legal updates not yet being released.
• SB 1178 (Padilla; D-Chula Vista): Unfair and Unenforceable Regulation. Attempts to impose California law on facilities outside of the state and nation. Makes industry wholly financially responsible for water quality impairments caused by other sources. Oppose Unless Amended.
• SB 1404 (Glazer; D-Contra Costa): Lobbyist Employer Audits. Substantially raises fees on lobbyists and others to continue to comply with state law.

Opposed Bills Moving

CalChamber-opposed bills that passed the fiscal committees with amendments included:

• SB 399 (Wahab; D-Hayward): Bans Employer Speech: Chills employer speech regarding religious and political matters, including unionization. Is likely unconstitutional under the First Amendment and preempted by the National Labor Relations Act. Job Killer 2023
• SB 1047 (Wiener; D-San Francisco): Enacts the Safe and Secure Innovation for Frontier Artificial Intelligence Models Act. Requires frontier AI developers to make a positive safety determination before initiating training of a covered model, among other things, subject to harsh penalties that include criminal penalties. Creates significant uncertainty for businesses due to vague, overbroad and impractical, and at times infeasible, standards, requirements, and definitions. Focuses almost exclusively on developer liability, creating liability for failing to foresee and block any and all conceivable uses of a model that might do harm—even if a third party jailbreaks the model. As a consequence of such issues, deters open-source development, undermines technological innovation and our economy. Further imposes unreasonable requirements on operators of computing clusters, including a requirement to predict if a prospective customer “intends to utilize the computing cluster to deploy a covered model” and implement a “kill switch” to enact a full shutdown in the event of an emergency. Establishes a totally new regulatory body, the “Frontier Model Division” within the Department of Technology, with an ambiguous and ambitious preview.
• SB 1089 (Smallwood-Cuevas; D-Los Angeles): Pharmacy and Grocery Closures. Creates new requirements for store closures that overlap with existing WARN Act requirements and subjects stores to a private right of action for any failure to comply with the new requirements.
• AB 3211 (Wicks; D-Oakland): AI Watermarks. Places very prescriptive and technologically infeasible requirements on AI developers, large online platforms and camera/recording device manufacturers to incorporate a brand-new technology that is still developing. What this technology is currently capable of changes basically every month. For example, just a couple months ago, there wasn’t a program that can watermark text, making the bill’s requirements to do so impossible to comply with. Currently, one company is seemingly closer to having that technology, but the technology is not yet fully reliable, raising serious competition concerns around entrenching market leaders. When violations invariably occur, companies face significant penalties under this bill.

Also moving are:

• SB 1299 (Cortese; D-San Jose): Agricultural Workers’ Compensation Presumption. Creates workers’ compensation presumption that would require the Workers’ Compensation Appeals Board (WCAB) to adjudicate agriculture Cal/OSHA claims and impose a presumption regardless of any causal link between the alleged occupational injury and a violation of any provision of heat-related standards.
• AB 1949 (Wicks; D-Oakland): Vastly Expands Existing Opt-in Rights for Children’s Data. Prohibits businesses covered under the California Consumer Privacy Act from selling or sharing the personal information (PI) of anyone under the age of 18 unless the minor or the minor’s parent/guardian provide affirmative authorization (opting in), whereas the CCPA currently applies the opt-in right to minors under the age of 16, conditioned upon the business having actual knowledge that the minor is under 16. Further expands the right to opt-in to also now restrict the ability of businesses to collect, use or disclose minor’s PI or sensitive personal information, unless the minor or the minor’s parent or guardian, opts-in. In neither scenario is actual knowledge required, effectively forcing businesses to engage in age verification for every consumer and obtain opt-in consent from those shown to be under 18.