With California’s legislative session coming to a close on Saturday, legislators are busy wrapping up their work. Key among the final bills to be decided on is a California Chamber of Commerce job killer bill that chills employer speech, an opposed bill that limits oil production, and an opposed bill that stifles free market transactions for health care entities.
Legislators are also expected to take up a recently amended and closely-watched proposal, AB 98 (J. Carrillo; D-Palmdale), that establishes rules for certain truck routes, warehouse design, and build standards for specified classes of development projects. While CalChamber has a neutral position on the bill, it represents an important compromise and CalChamber would like to see the bill move forward. CalChamber Vice President Adam Regele characterizes the proposal this way: “Under threat of far-reaching legislation and local moratoriums on critically necessary warehouse projects, we believe this compromise strikes a key balance that allows California’s goods movement and logistics industry to continue to thrive.”
Employer Speech
CalChamber job killer bill SB 399 (Wahab; D-Hayward) chills employer speech regarding religious and political matters, which is broadly defined. It is likely unconstitutional under the First Amendment and preempted by the National Labor Relations Act.
SB 399 will deter companies from communicating at all about political matters, including informing workers about impacts of legislation, hosting fundraisers, or supporting local candidates.
In a letter sent to legislators, the CalChamber pointed out that SB 399 is unnecessary because California and federal law already protect employees from any employer coercion related to political activities or beliefs. Any employer who is coercing an employee to vote a certain way, attend a political rally, support or oppose certain legislation, or to vote for or against a union is already breaking the law. SB 399 is so broad that it would impact day to day operations or efforts to keep workers informed about local issues.
SB 399 is also problematic because any good faith error in interpreting the bill or trying to comply creates liability for penalties under the California Labor Code.
A similar bill was vetoed in Colorado for putting employers in the “impossible position” of trying to determine when any communication may constitute a political matter. Similar legislation has been struck down, challenged in court, or vetoed in other states.
Limits on Certain Free Market Transactions
AB 3129 (Wood; D-Santa Rosa) is a CalChamber-opposed bill that requires private investors to obtain the consent of the California Attorney General (AG) before acquiring or effecting a change of control with respect to certain health care entities.
Many health care providers in California are under-resourced and struggling—particularly in underserved communities, where residents already suffer from a lack of access to care. AB 3129 gives the Attorney General new power to unilaterally and arbitrarily reject private funding and investment that serves as a lifeline for struggling health care providers to preserve access to care and as the resources needed to expand access to care.
The potential annual cost of the appeal process recently added to AB 3129 is at least in the millions of dollars given the average annual number of transactions, the annual average value of these transactions, and the likelihood parties that need to exit their investments will be highly incentivized to appeal the decision of the AG.
AB 3129 threatens the private investment and partnerships that are helping drive innovation and expand access to care. Private investment has helped dental practices expand access to care to more underserved children; helped thousands of physicians by providing administrative and back-office support; enabled access to reproductive treatment with greater convenience and support; and funded outpatient clinics, oncology clinics, long-term care, urgent care, dental care, behavioral health, and other medical care that have strengthened California’s health system and improved patients’ lives.
Oil Production
Another CalChamber-opposed bill awaiting action today is AB 3233 (Addis; D-Morro Bay). This bill authorizes local governments to limit and prohibit oil production.
AB 3233 seeks to circumvent recent California Supreme Court case law and Section 3106 of the Public Resources Code (PRC), and replace the comprehensive, longstanding state law with a patchwork of local ordinances that may ban or add unfeasible limits to oil and gas exploration, production and abandonment work. This bill has the potential to open local governments to significant legal liability under the takings clause of the U.S. Constitution. If local governments enact an ordinance that prohibits oil production, there are increased projected potential local government costs of $27 billion.
Staff Contacts: Ashley Hoffman, Preston Young
