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Thursday, Mar 28, 2024

Still an Abundance of Anti-Business Bills

It appears that the California Legislature has finally figured out how to solve the problem of illegal immigration. No, it isn’t at the border. The answer is to continue passing bills that make it more costly and difficult for businesses to operate here and to avoid legislation that provides incentives to lower operating costs. Soon, the only significant employers remaining in California or not outsourcing all of their operations will be the state and local governments. The private sector jobs that the immigrants are currently flocking to will be gone and the immigrants will be better off remaining in their previously impoverished homelands, which will be flourishing with new jobs and strong economies. Congratulations to the California Legislature! Instead of passing bills to provide incentives to attract businesses to California or to retain businesses already operating in California, the Legislature continues to pass anti-business and anti-jobs legislation. AB 777(Nunez) that would have provided tax incentives to California’s premier industry, the entertainment industry, to film in California instead of other states and countries was stalled in the Senate Revenue and Taxation Committee and never received a vote during the final week of the Legislative session. Additionally, much talked about and needed legislation to provide incentives in the form of tax credits to the manufacturing and other labor intensive industries to remain and/or return to California was not even introduced. To make matters worse, there were numerous bills that passed both houses of the Legislature and some that passed one house and will be carried over to the next legislative session that could cause a significant loss of businesses and jobs. Those bills that passed both houses and will go to the Governor for consideration include: (1) costly workplace mandates, AB 2209 (Pavley) which forces California employers to subsidize strikes against their own company by requiring employers to pay locked out workers a monetary penalty equal to the level of unemployment insurance benefits workers might have received during a trade dispute if any business misconduct is merely alleged, SB 840 (Kuehl) which imposes a government-run health care system on all Californians that could result in significant increased taxes and costs to employers and SB 1414 (Migden) which imposes a tax on employers with over 10,000 employees to spend 8% of their total payroll costs on health insurance or pay the equivalent amount to the state; (2) economic development barriers, AB 32 (Nunez) which increases costs for California businesses, makes them less competitive with other states and discourages economic growth with little or no proven environmental benefit by adopting an arbitrary maximum on carbon emissions, SB 1368 (Perata) which limits the available power sources to meet California’s energy demands while substantially increasing the price of electricity to consumers and businesses by establishing what appears to be an unattainable greenhouse gas emission performance standard and SB 1523 (Alarcon) which impedes economic development by adding an economic impact report prior to the superstore retailer approval; (3) expensive, unnecessary regulatory burdens, AB 1379 (Perata) which makes California unfriendly to business by establishing a biomonitoring program that could lead to the elimination or reduction of the use of certain chemicals that have not been scientifically proven harmful, based on mere detection; (4) fuel price increases, AB 1012 (Nation) which mandates the sale of scarce alternative fuels such as ethanol and bio-diesel; and (5) increases in frivolous lawsuits, SB 1489 (Ducheny) which results in potential harassment of employers by a government agency by making defendant companies pay all the investigation and lawsuit costs, including attorney’s fees if the Attorney General “prevails.” The term “prevails” could include settlements, changes in operation by a defendant or even a nominal monetary award to the plaintiff. It does not necessarily mean that a judgment was awarded. It is unfortunate that a significant number of our legislators have not had the experience of running or even working in a private sector business. If they did, perhaps they could understand that by their actions they are punishing the lifeline of our state, the business community and will ultimately cause the loss of a large number of jobs and a major reduction in state revenues. The following are the Business/Job Killer Bills I have chosen to profile this month: > SB 109: This bill allows for both civil and criminal penalties for violations of California air pollution laws which could include minor violations thus potentially increasing lawsuits and the costs of litigation providing yet another reason for employers to leave California. Status: Passed Senate 5/31/05, failed Assembly Natural Resources Committee 8/29/06. Valley Senators voting for bill: Alarcon, Kuehl, Scott. Valley Senators voting against bill: Margett. McClintock, Runner. >SB 760: This bill puts California’s ports at a competitive disadvantage potentially resulting in cargo being diverted elsewhere, away from California ports. It also imposes a new tax called fees to avoid the California Constitutional requirement of a two-thirds vote for approval of new taxes. > Status: Passed Senate 5/31/05, currently in Assembly. > Valley Senators voting for bill: Alarcon, Kuehl, Scott. > Valley Senators voting against bill: Margett, McClintock,Runner. Gregory N. Lippe, CPA, is Managing Partner of the Woodland Hills-based CPA Firm of Lippe, Hellie, Hoffer & Allison, LLP and a Director and Vice-chair of the Valley Industry and Commerce Association (VICA).

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