June 29, 2026 · Business Prof Econ Development · 24,185 words · 13 speakers · 124 segments
All right, good morning, everyone. Welcome to the Senate Business Professions and Economic Development Committee. A couple announcements, as you guys know, that I like to go through so everyone's on the same page. We will have authors speak here, witnesses, lead witnesses speak at the mic over there, and each witness will have two minutes to present their case. Afterwards, we're going to have Me Too's. The Me Too's are strictly name, organization, and whether they support or oppose the bill. No additional commentary will be allowed. With that, we have 19 bills on our agenda. The following items are proposed for consent. File item number 2, AB 1640 by Assemblymember Stephanie. File item 5, AB 1954 by Assemblymember Ward. File item 13, ACR 210 by Assemblymember Jackson. File item 14, AB 1767 by Assemblymember Berman. With that, we're going to have our very first speaker. File item number four, AB 1921.
Assemblymember Ward. Thank you, Madam Chair and members. I appreciate, I'll just start with item number five and thank you for your consent recommendation. But back to item number four, I'm proud to be here to present AB 1921. I really want to thank the committee and their staff for a lot of their thoughtful engagement work on this bill. AB 1921 really seeks to be able to protect video game users against premature shutdowns of their digital games. Video games have become one of the largest entertainment markets in the world. and recently the rising prevalence of live service games require online server connections has been raising a concerning issue of consumer protections. Now this bill responds to public outcry over games shut down with as little as two weeks after launch, leaving players with nothing. It used to be that video games remained playable so long as you had a functioning hardware and a copy of that game, and this included multiplayer games, which could be played locally for years or decades without ongoing publisher involvement. Today, many games rely on publisher-run authentication or gameplay servers, meaning that if a company discontinues server support, the game can become unusable overnight, even if the consumer has a physical disk. Now, the ability of a publisher to remotely disable a product for which a consumer is paid $60, $70, $100 or more sets a concerning precedent for our digital goods. AB 1921 really has two elements there that really seek to build some fairness in there between that user and the provider. One, that a game operator notify users 60 days before shutting down servers required to make an ordinary use of a game. This will allow them to understand that if I'm about to sign up for that license, that I might have 60 days or less to enjoy use of that product. Or two, if I've already been licensed to be able to enjoy that product, that I better make full use of it before that 60 days is up and not walk away from the game and come back later only to find all my data gone and that game shut down. Further, the second is that it would require a menu of options for the operator to provide a means of accessing playable versions of the games from either a menu of compliance options or offering a reasonable refund once some of those services cease. This provides some fairness to say if you didn't get full enjoyment out of that game like we used to in the 1980s when you bought the cartridge and you would blow on it to make sure that that still worked and that you were still able to get continued enjoyment out of that, that there would be some recourse there for the consumer, whether they laid down 60 bucks or 100 bucks or 200 bucks, to be able to get some kind of value for what they had spent up front Now to be clear AB 1921 does not mandate that servers be supported forever Instead it asks the game operators to plan for the end of life of a game during its development if it relies on server support. I'm committed to continuing to work on the recent amendments regarding community servers and partial refunds to ensure that we strike that right balance between consumer fairness and industry feasibility. As people increasingly consume entertainment via licensed digital goods, furthering consumer protections and transparency is essential, and that's all that this bill is about. With here as a witness in support is Becca Kramer on behalf of Consumer Reports. And I know Madam Chair, we're in a subcommittee, but when the time is appropriate, I respectfully request your aye vote.
Perfect. Thank you.
Hi, Becca Kramer with Kaiser Advocacy on behalf of Consumer Reports, proud supporters of AB 1921. AB 1921 would require that developers of video games make consumers whole if they pull online support for games. either by offering an online version of the game or providing customers with a refund. It used to be that when we bought a video game, we could play it forever as long as our hardware still worked. But today, more and more of what we buy is tethered by software back to the manufacturer. The software tether can enable features that can be positive for consumers like cloud backups, but it can also compromise our ownership rights if a company can just snap its fingers and suddenly we lose our features or even the ability to access content or use an appliance at all. And there's a lot of uncertainty under the law today about what happens when a company breaks devices or content. We have seen occasional regulator action on this issue. The FTC has sent warnings to Major League Baseball and Microsoft saying that people who bought digital content expected to be able to access it in perpetuity, and that turning off digital rights management, or DRM, servers could be a deceptive or unfair practice. But those were just a few informal actions, now somewhat in the past, and business practices are evolving. A lot of companies are pushing the envelope in terms of what they can get away with. Some games, especially interactive multiplayer games, are marketed as subscriptions. Those have higher ongoing operational costs for the developer, and so people generally understand that this is an ongoing transaction that will stop at some point in the future. But for other games, like single-player games, people don't expect that a company will just turn off DRM support, and a game that seemingly should work perfectly well without Internet access suddenly doesn't work at all. This bill would ensure that consumers get what they reasonably expect when they pay to download a game from a software store. And for that reason, we urge you to vote aye on this bill. Thank you.
Do we have any other lead witnesses? Seeing none, we're going to move on to lead opposition witness.
Two minutes. Thank you, Chair and members. Jennifer Gibbons with the Entertainment Software Association. We are the trade association for the video game industry, and we are here to oppose this bill. The bill is trying to solve a problem that has not been demonstrated. It rests on two flawed premises. One, that consumers who purchase a license for a video game should have access to it indefinitely. No other digital product is subject to that standard. Books, movies, music, software, and online services are not required to remain available forever, yet this bill would apply that obligation to video games. This is a significant change in policy that should be seriously considered. second the bill assumes that publishers are routinely taking games away from consumers without notice or compensation which just is not accurate this the example cited in in the analysis don support the claim In nearly every case consumers received advance notice that that online service would end and many of these games were available for five to ten years before they were sunset. This is a question of consumer satisfaction, not consumer protection. Finally, compliance options in this bill raise serious safety and legal concerns. Where compliance is impossible, this bill is going to require refunds that bear no relationship to the years of entertainment that the consumer may have received. Whether they played the game for 10 years or 20 years, we would still have to provide them a refund if we can't comply with the options. The author has said he's willing to amend the compliance options since they would encourage moving gameplay into environments outside of publisher oversight, moderation, and security controls, which raises serious safety issues. However, continuing to require games to be provided indefinitely cannot be done without legal and safety issues. ESA has suggested looking at the approach taken by Assemblymember Irwin in AB 2426 related to digital goods. Thank you.
Thank you. Appreciate your time. Any other lead opposition? Seeing none, we're going to move on to me-toos. State your name, your organization, whether you support or oppose. Seeing none, we're going to move on to committee members. Seeing nothing, Assemblymember, would you like to close?
Yes, ma'am. I just wanted to ensure that there were no questions on this bill because I'm happy to really close and really underscore that we are.
Do you have a question?
Okay, sorry.
No worries. Go ahead. I was struck by a member who was in his wheelchair over there, hoping everything's okay. But wanted to – I did have a question about this, and we talked about this, Bill, and really appreciate you trying to help clarify. One, I would appreciate if, Madam Chair, we could just get some response to the opposition's point about the indefinite sort of realities of using the game. I'm unclear about that. But secondly, it looks like currently, and please help me understand this, that a refund is given when access to the game is no longer offered. I agree with refunding resources. You pay for something, you expect to use it. When you can't use it, give me my money back. I understand that. But I'm confused about the legalities of being able to offer these different options, playing on different platforms. It seems very complicated and just curious. Is the goal to make the consumer whole? And to me, that's, you know, I'm paying a fee. I don't get the service.
I get my money back. The other pieces, I'm unclear, and it seems like that there are some questions about copyright and if that's possible. So if you could clarify those two things, I'd appreciate it. A couple of things there. So first of all, I would say that right now there is no requirement for any refunds under law. And secondly, yes, I think the goal here of the bill is to make sure that there is some balance and some fairness here between somebody that signed up for this license, paid a substantial amount of money because they thought they were going to eat a reasonable period of enjoyment out of this and then had the rug pulled out from under them and really are walking away with nothing. And so whether that, and what I want to do through the bill, what we've started since the get-go, is to really create that menu of options. A refund is just one option, and it needs further refinement. What we have in print already through some of the amendments right now is to recognize that no it not fair to actually ask for an indefinite refund period If I paid for something today am I due a full refund 10 years from now after a game then shuts down No you got 10 years worth of opportunity and use out of that And I would say as a reasonable person that that's full enjoyment, right? But if I sign up for today and it was gone in two weeks, well, then I kind of feel like I was like, you know, really snookered and really sold a lemon there and probably deserve something back. So finding that time point, whether that's six months, a year or longer is the subject of, I think, that fine detail that we're working on. And whether or not it's from the time of purchase or the time of when that game was actually shut down is another sort of time point, another factor point that is really going to be the subject of future negotiation. But it's the intention of what we want to do is to really meet that reasonable test of what would be a reasonable period of refunds. And I would also argue allowing for a declination of refunds so that, you know, 50% of your way towards that time point, you only do a 50% refund. And then as you get closer and closer, you're getting closer to zero in terms of the valuation of what that refund should be. But a refund should only be one of the options for compliance. If it is possible, as it is possible right now, to be able to use community servers, I want to talk about some of the conversation out there around security and copyright and other issues that are around there too. but they already exist here today. That's an option to be able to provide that platform where you no longer as a company, as a developer, have any responsibility to maintain that, to update it, to put any more of your capital, of your investment into, you know, continual maintenance of that. But there is still some core content opportunity there for you to be able to enjoy. That's one option there because then you still feel like what I signed up for, I'm getting some kind of continued benefit for a period of time. Another option that we've enumerated as here in the options are to be able to have some kind of a downloadable version or an offline version that could be available through the company's server. But again, requires no more investment, no more continued maintenance, but allows the user to continue to be able to enjoy that. My point being, you can't save your data. You're not going to get the system updates. You're basically kind of going back to square one, but that's kind of what you signed up for is to use the game as you invested in the first place and to allow that for some reasonable period of time. So there's a menu of options there that could include a refund but also give an alternative to refunds for the producer's use.
Yeah, I just I feel like there are a lot of different options in this bill. I'm not clear on as a user the complexity of all of it. I feel like maybe there's some more work needed here. but I think we are the last we're the last stop on this bill and so I am I'm I agree with the refund I wish the bill just focused on making that clear as a first step and then maybe we come back and do other pieces and so and we talked about this I think I'm going to lay off the bill today But, you know, hopefully we can get to a point where we can just be real clear about what the options are. But thank you so much for raising the issue.
Thank you. And, again, I would just say the options are there to be able to provide the flexibility for the producers. And they could always choose a refund or they could have some other option that, again, meets the principle of allowing the purchaser to have a reasonable enjoyment of the game.
Senator Menjivar.
Ma'am, if I could ask the opposition a question?
Go ahead.
Just if I could get clarity. In the analysis, the author gave some examples. One of them was the Concord. It was only on for two weeks and it got shut down. And we're talking about the ability for a consumer to be made whole if it gets off the server so quick. In that example, if I bought a game two weeks later, it's no longer on. Currently, right now, can I go and get a refund?
In the example of Concord, Sony did offer full refunds to everybody who bought that game, and they were notified in advance. The reason that game got shut down is because players complained that they didn't like it. So Sony said, okay, we heard you, they issued an apology, and they offered full refunds in that case. The other case in the analysis is the crew, which was online for 10 years. So they did not offer refunds, but there was three to five month advance notice, if I recall. So notice and refunds are standard industry practices. In the analysis, there's one example. During a reasonable time, 10 years, maybe not so much. 10 years, no. But standard video game retailers will also provide refunds within 14 days if you bought a game and you didn't play it and wanted to return it. So there's also that option.
And can you, the author, one part of the bill is around the ability to go on a community server. The author is stating that that's currently allowed right now so long as you're, I don't want to misunderstand what you said as a member.
That's correct. Minecraft is currently hosted by community servers, Call of Duty community servers. So it's an option that is out there in existence here today. They're illegal, and they are not in any way affiliated with Microsoft. Microsoft for Minecraft has gotten a lot of criticism because of those community servers not employing the same safety standards that Microsoft does on their Minecraft servers.
So is it like the black market of video games?
Yes. In fact, we consider it piracy. We have lawsuits, two pending lawsuits against private servers right now, and the United States Trade Representative in their notorious markets reports on counterfeiting and piracy has named some of these big private servers as a notorious market.
Thank you so much. As a member, I don't want to ask the same questions as my colleague because they're the same exact concerns and questions. my additional one would be what can you do for the protection around you know the community server aspect you know we spoke about this and my concerns on that and then I think she asked this question but I didn't hear it exactly the copyright in artists' songs voice utilized on something license no longer exists I don't know if this is correct so correct me if I'm wrong. I don't know if they get paid while the license is alive and after that, that artist no longer gets residuals or what have you. Once it's offline, their likeness and so forth is still being utilized. Do they still get compensated for that? I don't know if you can
address those two things. Sure, absolutely. Again, this is not a requirement that community servers be used. We actually added this following the Senate Privacy Digital Technologies Committee because they wanted more options and they said, well, hey, you have these community servers out there as a place that maybe is already in existence here today, could that be an option for resolution rather than a refund or a downloadable or an offline version that somebody could play? And we said, sure, we're open to new options that make sense to be able to connect that relationship between the purchase. But if that is something that is reaching new criticism and injecting new kind of points about safety or about violation of copyright, you know, it's not something that needs to be in the final form of this bill. I was just responding to other senators on another committee as like an expanding menu of options here too So that is something I certainly would be up for further conversation as well and I do recognize that within the narrow context of this option here Sure, if something is out of your control and is now hosted over here by this entity right now, could that then be downloaded? Could that information then be transmuted in a way that is using somebody's PI, somebody's likeness, somebody's copyrighted information, and then transformed using AI or any other methods to be able to create something else of equal likeness and everything. I guess theoretically that is a risk that is out there right now. Getting, I think, you know, as we want to be thoughtful about how something would play out over time here, that is, I think, a conversation that's up for debate. Probably the subject of a separate bill, what do we do about community servers over there, which maybe is rightful that one of us take that on and take a closer look about, you know, making sure that safety and copyright infringement and other issues are in existence in California's landscape. But we're just trying to create that menu of options here for resolution and opportunity, I guess, for that user.
I can imagine stuck in a hard place because other members were asking for something, and now the unintended consequences of that here, of the protections. Just rightful to think through.
Yeah. Yeah. And, you know, I think, you know, I shared the core of should a consumer have access to something in perpetuity if it no longer exists? That's at the core of a question that I'm still trying to navigate as well.
And I missed your opening. Did you provide any commitments?
Yes.
If it came out of committee, what you would amend if on your own?
Yes, so there is already a commitment, I think, on some of these issues as well to be able to continue to work on that narrowing and, like, really scope of duration for and sort of de-escalation of a refund period and a refund amount over time is, I think, what we have taken one step already for the bill that's in print and that we're going to continue to be able to work on should this bill be able to move forward. and the question of community servers, I would want to, of course, go back to the chair and the committee members for the privacy committee to make sure that at their request adding it in and now thinking through if there are some new complications there, if that is something that respectfully we could actually take out as an option for the bill.
Senator Small Equal, that would actually narrow it further as to refunds being, you know, one of the more direct options that are available.
But I've got to do that dance right with all y'all. So I'm willing to do that if this bill is able to move forward to try to be able to get these options right.
It sounds, though, like there isn't a firm where it would land. It sounds like it's still conversations still happen, but there's no firm where exactly it will land.
I would say this to the world and Senator Cabaldon, who might be listening, that there is a commitment on my end to be able to work with you to be able to have that further refinement. But I would only do so out of courtesy and with engagement with him because of our relationships and our process.
OK, thank you. All right. First and foremost, I actually do appreciate this bill as a person who actually does game. You know, what we've been seeing more and more is this model that has been moving to the subscription model. Originally, subscription models used to be a lot cheaper, and that is why so many people signed up. And they would also do it in a way where it was free at first. Right. and then the old school models of you know I'll go back and date myself when you bought CDs you kept it forever right and yes there were maybe issues with patches and security updates and things like that but people actually enjoyed having that and being able to own it own it what we are doing in pretty much every single industry is moving into the subscription model whether it TV whether it software whether it video games things like that that I actually think there pros and cons to it But I also think that we do need to make sure that people are made whole when they are buying a particular game if it's not working out. And I do appreciate the commitment from the author to kind of narrow this. This is a space that I don't think a lot of people touch and something that I'll be very honest with you. A lot of my colleagues probably are not gamers, right? So I know that there's a lot of gamers out there that would probably like to be made whole or even some type of threading of the needle. So with that, would you like to close?
No, I appreciate all the conversation. I appreciate everybody for the chance to be able to dialogue ahead of this to describe the intent of the bill and where we're at here today in committee and the finer points of what may still need to be worked on, of course, going to appropriations and then to the floor as well, some more steps to be able to tackle those issues. You know, I would note that, you know, in other forms of media that we have, when we think about books or music or other areas there that are also now streamed online, there are still ways to be able to purchase things, download things, and so videos have become a way that are sort of being segmented away from other forms of media and are unfortunately being subjected to this take it or leave it scenario where you really are always at the behest of the operations of that server, and they are the ones that can be able to flip the switch and really provide, I think, a distortion and a disbenefit to the consumer that is really just trying to get the full enjoyment for the amount they laid on the table that they wanted to be able to have for some reasonable period of time. You and I probably come from the same generation. I think our gray hairs are telling us that. So we had that enjoyment in the period. know in our youth and I really want to be able to make sure that our youth today are able to be able to have that same relationship and that same expectations. This is something that is not new to the world. This is actively being worked on in the European Union right now. California would be the first state to mirror that work and have very similar kinds of reasonable parameters about what we do and we don't do when the decision is made to pull a game off of line. But I think that this balances things fairly between the two parties and really makes sure that consumers' interests are at the front and center of the work that we do here in the legislature. With that, I would respectfully ask for your aye vote. Thank you.
We do not have quorum yet, so when appropriate, we'll ask for that. So thank you. We're going to move on to file item 6, AB 1965, by Assemblymember Sharp Collins.
All right. Good morning, Chair and members. I rise to present Assembly Bill 1965, a bill that strengthens the Department of Cannabis Control's authority on cannabis testing, ensuring Californians are safe. When voters passed Proposition 64, they were looking to us to provide a safe, legal cannabis market. Reports show that we are failing to deliver on that promise, in part because of the existing regulations the actual framework does not provide for the Department of Cannabis Control to have adequate authority. This lack of oversight of testing labs or facilities leads to unsafe cannabis that pose the risk of nausea, vomiting, seizures, and also cancer. This bill addresses these issues by modernizing product safety standards and increasing transparency and enforcement. Assembly Bill 1965 protects consumers, safeguards public health, and restores faith in the legal cannabis market. Here today to testify and support is Amy O Jenkins on behalf of the California Cannabis Operators Association Thank you Thank you Madam Chair and members Amy Jenkins California Cannabis Operators Association
We represent about 500 cannabis licensees throughout the state. We're very pleased to support this bill, and we want to thank the author for her ongoing leadership to try to strengthen our testing regime here in California. We have built one of the most rigorous testing systems in the country. Maintaining public confidence in that system is critical. not only to protecting consumers but also ensuring the long-term success of California's regulated market. The overwhelming majority of licensed operators invest significant time and resources to comply with California's testing requirements. They deserve a marketplace where everyone is held to the same standards. For compliant businesses, this bill is also more than just regulation. It's about fairness. When testing standards are applied consistently, responsible operators are no longer competing against those who seek an unfair advantage by manipulating or circumventing the rules. At a time when we are still looking at a 60% illicit market, preserving consumer confidence in the regulated marketplace has never been more important. California has invested years in building this system. That investment only succeeds if consumers can trust the products they purchase and responsible businesses know the rules. For these reasons, we ask for your aye vote today. Thank you very much.
Thank you. Do I have any other lead support witnesses? Seeing none. Lead opposition? Seeing none. Me too's? Seeing none. Committee members? Senator Archuleta. Thank you, Assemblymember, for bringing this forward. And all of us who love our law enforcement, we know that any business that's running legitimately should be protected, as the cannabis industry should be legally run and protected. And to give the industry the oversight and the power to check some of the discrepancies when it comes to potency, when it comes to changing the product to a point for segments. We've got to have the standards, and I think this is what this bill does. So I definitely will support it and move it at the appropriate time. Thank you. Thank you. Would you like to close?
I respectfully ask for your aye vote.
Thank you. And when appropriate, we'll move the bill. Thank you. Thank you. All right. We are going to move on to... We have a quorum. It looks like we have a quorum. Can I get a roll call, please? Wahab. Wahab here. Here. Choi. Here. Choi here. Archuleta. Here. Archuleta here. Adagin. Cabrero. Grayson. Here. Grayson here. Menjivar. Here. Menjivar here. Nilo. Smallwood Cuevas. Smallwood Cuevas here. Strickland. Umberg. All right. We have quorum. I'd like to get a motion on consent items. Moved by Senator Grayson. Wahab? Aye. Wahab, aye. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Caballero? Grayson? Aye. Grayson, aye. Menjivar? Aye. Menjivar, aye. Nilo? Smallu-Cuevas? Aye. Smallu-Cuevas, aye. Strickland, Umberg? All right. That consent is on call. We're going to move on to Assemblymember Patterson. File item number 8, AB 2141.
Thank you, Madam Chair, Senators, video games, pot, and mine's a little less interesting than those ones, but happy to present it as well. So AB 2141, when this legislation was brought to me, was of personal interest because I used to actually work in a regulated industry in which the only remedy to situations in which the state or the regulator saw issues was to file an accusation against the licensee. And since that time, that particular industry, there have been changes, as there have been others, that allow a cite and fine which take away the burden of the administrative agency to file an accusation through the Department of Justice, which, as you know, causes a lot of money. And one thing I read in the analysis was that the board settles in this particular instance, in the Board of Pharmacy, settling accusations against pharmacies, the board settles approximately 80% of its disciplinary cases post-accusation. I would be willing to bet the vast majority of those can be settled prior to an accusation and prior to something going to the Department of Justice if the agency reaches out to the licensee. In many cases, the agency does reach out to the licensee. They see an issue, and they would actually like to resolve it, but the current law doesn't allow that to be the case. So when this legislation was brought to me, just given my experience, this interests me a lot. And I do believe it should be applied much more broadly than just this agency. We have been seeing legislation come through the legislature that's sort of piecemeal, various agencies. And that is something I'd be willing to consider and work with the committee in the future on. But for this particular one, we're looking on the Board of Pharmacy, and I think it's a good piece of legislation. Obviously, we'll be happy to answer any questions when they come. Today I have Marie Kottman to speak in support of AB 2141.
She's here on behalf of the Alliance of Pharmacy Compounding, and she's a licensed pharmacist as well. Thank you, Chairwoman Mohamed, members of the committee. I appreciate the opportunity to speak in support of AB 2141. My name is Marie Kottman. I'm a licensed pharmacist and former owner of Pacific Compounding Pharmacy in Stockton, where I served thousands of patients for more than 20 years. Throughout my career, patient safety and regulatory compliance were always my highest priorities. I participated in the Board's rulemaking process and invested heavily in training facilities and procedures to meet evolving compounding standards. My concern was never with complying. It was that reasonable, good-faith differences in interpreting highly technical regulations and USP standards could become formal enforcement matters without any opportunity for early resolution. AB 2141 provides a practical solution. Participation is entirely voluntary. If a licensee disagrees with the board's findings, they simply decline the offer and retain every existing due process right. When both parties agree, appropriate cases can be resolved earlier while fully preserving the board's disciplinary authority. Some have expressed concern that this bill could set a precedent for other licensing boards, but California already recognizes that different professions sometimes require different disciplinary procedures. The Medical Board, for example, has its own specialized hearing process because medicine presents unique regulatory issues. AB 2141 follows that same principle by creating a pharmacy-specific procedure tailored to the unique regulatory environment of pharmacy while fully preserving public protection. Other states, including New York, Washington, Oregon, and Illinois, already use similar processes successfully. Had a process like this existed a few years ago I believe I would still be serving patients as an owner of an independent pharmacy in Stockton I respectfully request your aye vote on AB 2141 Thank you Thank you Do we have any other lead witnesses
Seeing none, do we have lead opposition? Okay. Do we have me-toos? Seeing none, we're going to move on to committee members. Senator Menjibor.
As a member, can you walk me through this? if a licensed individual is doing something unethical and so forth, they will no longer be accused, formally accused. They can dispute that without a formal accusation. And would the public ever be made aware of that licensed unethical behavior or XYZ behavior? Yes.
And, you know, first of all, I want to mention that. In instances where there's unethical behavior and things like that, there probably still would continue to be an accusation filed against the licensee. This helps resolve the majority cases, which are very small cases. And I'll just say, you know, some of those, for example, as the witness mentioned, might be a different interpretation on how certain standards are applied. For example, the Board of Pharmacy just recently adopted, as I'm sure you know, very long and lengthy compounding regulations that are actually very, by the way, very unique to this state that change access actually to medications from this state that make it different than 49 other states. But anyways, there's a lot of nuances to those, and a pharmacist may have a different way of maybe they fill out the applications or maybe they're compounding the pharmaceuticals and things like that, that instead of doing an accusation, you can resolve it on a staff-level basis. But generally speaking, settlements still have to be approved by the regulators. In other regulatory agencies, those go on the agenda just like everything else, and they're approved. The stipulated settlements are approved by the board. But the bill doesn't create a threshold of what would be eligible. So while your answer said we want to focus on some of the smaller ones, it does not preclude any higher level kind of accusations from following your this behind the scenes kind of settlement. And the analysis already notes that this is already an option available where, trying to find it, existing law. Under existing law, the parties already retain broad authority to negotiate and resolve disciplinary matters through settlements without proceeding to administrative hearing. but this kind of gives the ability, like I mentioned, to prevent the public from finding out what a licensee is doing or has done. I think this goes against transparency, against consumer protection, of precluding the public from understanding what an individual has done, now that we've given an option without a threshold of anything to bypass a former accusation and be settled behind closed doors. If I'm misunderstanding this bill, I would love for you to counter that. Yeah. You know, the stipulated settlement agreements are still approved in a public forum. So I so I don that wouldn really be the case in which the public wouldn know Many of these are the vast majority of these are very mundane issues that the board would I sure prefer to in most agencies again having worked very closely with one for many years, would rather resolve these without a stipulated agreement. And while there might be some, I believe, ambiguities in the law that they might retain that ability, that's not how to do stipulated settlements and agreements in advance. That's not how it happens in practice. That's not what occurs because it isn't clear that that's actually what can occur. So most of them go to an accusation with the Department of Justice who goes through a very lengthy multi-year process to settle even the most mundane accusations. I mean, sure, the settlement is public, but the formal accusation, what they were accused of is not public or the alleged violations. Those are not also public at all. The stipulated settlements always start with a list of what the issues were in the reason why there is a stipulated settlement. They always start with, you know, it looks like a court proceeding. It looks just like if you're filing a lawsuit or something like that. It looks pretty much exactly the same. And it starts with what the accusation was or what the complaint was in the first place. And here's the resolution.
If, if, because I keep hearing this, I remember from you, it's like the mundane ones. We want to, you know, get through those as fast, as quickly as possible, but there's no clear language that says these are just for those kinds of cases. If that was the intent, I'm wondering why that language isn't in there. Well, the board of pharmacy, which is our regulator that we've
entrusted with a broad range of abilities to make decisions on whether even to file an accusation in the first place or not. If we don't believe that the appointees, that the people making these decisions, that the regulator can decide which one should go to that level, then I think we have a systemic issue in the first place. But there's no lack of transparency. There's still going to be a public process that goes through this, still going to be public records. People will still be able to find out what's going on. I trust the Board of Pharmacy that on the big ones, they're still going to file an accusation for the interest of public safety in ensuring that those ones continue to proceed through a more serious process that it deserves.
I get where you're coming from. I still have a lot of concern that people like to protect their own. This is nowhere near this case, but I'm just giving an example. In the military, they have fought for years to not be able to have outside legal intervention of sexual assault cases because they're like, oh, you can trust us. We can handle everything. No one needs to come in. And that's been an ongoing situation because they want to take care of it themselves and protect their own. Nowhere near this bill, I'm just giving an example of the system you're saying that, you know, we should trust the, we do, but we should trust them to take care of their own and discipline their own when in fact system after system shows that they protect their own. So I think this, by that, on me, on the principle, I cannot get behind with, which is why I won't be supporting the bill. Thank you.
Do you mind if I respond to that?
Go ahead.
Thank you You know what you outlined obviously is very troubling and something that you know is really happening I think in the you know in the shadows right where there not a public process where there are things that aren public records In fact those are specifically excluded from public records This is a completely different process in which this is a public process. These are public records. And so while I understand that concern and that very serious concern, And that wouldn't really be the case here because of the public process in which it entails, essentially.
As members, we get our information, you know, the language and the bill. But the analysis specifically says members of the public will have less information regarding the nature of violations. So it's in there.
If there's a settlement on a situation, it is a public record. I mean, and you know, what's interesting is almost all of these accusations in every regulatory agency, by the way, it's kind of interesting when they put it forward because they almost always ask for license revocation. And that's really unfair for a lot of these even mundane issues. And I understand your concern about the serious ones, in which case those would continue to be part of a public process. But as a licensee, if you've got some kind of issue where the standards recently changed with the Board of Pharmacy, the compounding regulations, and they say, hey, look, we need to resolve this. You need to do it this way, right? And what you've been doing in the past is not the correct way according to our interpretation despite a lot of other states doing it that way. That's not how we do it in California.
So let's do a stipulated settlement right now instead of doing an accusation where we're saying, hey, we're going to take your license away from you. And that's those costs, those licensees so much money to to go through that process. And so that's why I think, you know, this is so important because these are people just trying to stay open. By the way, we don't have very many compound pharmacies left in California, by the way, very few. And a lot of that is because, understandably, we have some of the most strict regulations in the nation. Actually, we by far have the most strict regulations in the nation, and it is hard to comply with those. It's hard to keep up with the ever-changing tasks. And so if the Board of Pharmacy wants to go to you and say, hey, look, this is how you need to do things, but you've been doing it slightly wrong. We need to settle this right now instead of going to the Department of Justice and filing a formal accusation. So thank you, though.
Thank you.
Senator, all right, would you like to close?
Well, I really appreciate the consideration, appreciate the questioning, and I do understand the concern. I take it very seriously, the transparency of the public process, and obviously always willing to consider changes to the bill to make sure that that's the case. But ultimately, at the end of the day, what we're trying to do is prevent many of these accusations from happening in the first place, which costs the state of California a lot of money to resolve, generally speaking, not serious complaints. But if we want to set a standard on some kind of threshold or something like that, I'm always obviously happy to consider that. I think the concern would be is that does take away some of the discretion from the Board of Pharmacy to decide maybe it's a, let's say, somebody who has had several mundane issues, right? Maybe that one does need an accusation as a result of some of those smaller issues and many of them. So I think this does leave a lot of authority with the Board of Pharmacy to continue with the existing process if they choose to do so. But for many of them, it allows them to be resolved quicker and more efficiently for the board of pharmacy. state of California and because of that I respectfully ask for an aye vote.
Thank you. Do we have a motion? Senator Choi makes the motion. Can we get a roll call please? Motion is due passed to Senator Appropriations. Wahab? Aye. Wahab aye. Choi? Aye. Choi aye. Archuleta? Adeguin? Caballero? Grayson? Aye. Grayson aye. Mendivar? No. Mendivar no. Nilo? Smallwood Cuevas? Aye. Smallwood Clivas, aye. Strickland? Aye. Strickland, aye. Umberg. All right. That bill's on call.
Great. Thank you.
We're going to move on to file item number 9, AB 2163. Again, just reminding everybody that we have roughly 19 bills on our agenda. So please keep your comments short. Assembly member, do you want to – can he do it from there if that's easier, if you could just give him the mic? Or even this mic that you can detach and hand it to him. Yeah. I also think you can detach it. Just pull it forward and then the mic, the mic itself. Okay. We lowered the mic. It's all good. Whatever you're comfortable with. Yeah, you know. Whenever you're ready.
Thank you, Madam Chair, for accommodating me. I'm honored today to present AB 2163, which will establish a statewide framework to designate strategic clean energy and critical mineral development zones to support large-scale geothermal energy production and mineral supply chain development. California has some of the most ambitious clean energy goals in the world. However, to achieve these goals, California must expand its baseload renewable energy development. At the same time, California has some of the most abundant critical minerals in the world, capable of meeting the supply needs of our entire country. This bill, AB 2163, is about strategically identifying and prioritizing the regions that can deliver both. This bill establishes clear criteria to identify these development zones, such as critical mineral resource potential, baseload renewable energy capacity, and transmission access. This means that only those areas throughout the state that have the highest geothermal or mineral potential will receive such a designation. Recognizing the importance of areas that meet the criteria, AB 2163 requires the state to give priority consideration to projects and infrastructure investments within these zones. California stands at a critical crossroads. Such states as Arkansas and Nevada are moving aggressively to position themselves as leaders in critical mineral production, while countries around the world continue investing heavily to secure the resources needed for energy storage, advanced manufacturing, and national security. The reality is that California's window to lead will not remain open indefinitely. If we want to remain competitive we must be intentional about supporting the regions that are best positioned to deliver these resources responsibly and at scale What makes California uniquely competitive is not simply the existence of critical minerals, but the way we can produce them. In places like the Salton Sea region, we have the opportunity to recover lithium and other critical minerals from geothermal brine while simultaneously generating renewable baseload power. This approach has the potential to become one of the most environmentally responsible methods of critical mineral production anywhere in the world, avoiding many of the impacts associated with hard rock mining and large-scale evaporation ponds used elsewhere. AB 2163 recognizes that not every region is positioned to support these opportunities and that the areas in which the resources, infrastructure, planning efforts, and development potentially already exist, they should be prioritized. For my district specifically, AB 2163 is a vital tool as Imperial County and Lithium Valley host some of the world's largest lithium and geothermal deposits. In addition to the obvious energy development potential in my district, there are also tremendous workforce development benefits. Imperial County has nearly 20% unemployment rate, the highest in the state. The opportunities for energy development and the economic growth associated with such development will prove to be a major boost to a county that is often left behind as California focuses on the future. California should not be importing opportunity when we have the resources, innovation, workforce, and natural advantages to lead. AB 2163 helps ensure California remains competitive, strengthens domestic supplies, and fully realizes the geothermal and critical minerals opportunities that exist within our border. AB 2163 received bipartisan support in the Assembly and passed unanimously out of Senate Energy, and I respectfully ask for an aye vote. With me today is Barry Bean, the Assistant County Executive Officer with Imperial County.
Thank you. You get two minutes.
Good morning, Chair and members. My name is Barry Bean. I'm the Assistant CEO for the County of Imperial, and I'm here in support of AB 2163. This forward-looking bill helps align state investment with regions best positioned to advance California's clean energy and critical mineral future, and we're very excited about it. This past week, I attended Fast Markets Conference, and while there, there were presentations by leaders from Brazil, India, China, Nevada, Arkansas, Texas, Africa, and the list goes on, and they were there talking about the supply chains that they are building out in their regions and the investment in the business and economic opportunities. Now is the time for our state to lead. While AB 2163 is an incredible opportunity for Imperial County, it is truly a capitalizing opportunity statewide. In fact, California is the nation's leading producer of critical minerals. Today the U.S. Geological Critical Mineral List has 60 critical minerals and 58 of those reside here in the state of California. Imperial County is uniquely positioned to advance California's clean energy and critical mineral goals with an existing 600 megawatts of geothermal operating capacity, over 4,000 megawatts of reservoir capacity, as well as two permitted commercial lithium projects, 23 critical minerals in our lithium brine, and a third of the world's lithium in that brine, as well as a 51,000-acre Lithium Valley plan. We have the resources and planning to lead. I'm born and raised in Imperial County, and this opportunity is more than just an energy initiative for us. Lithium Valley is a transformational opportunity for a region that faces 21% poverty and, as you heard, over 17% unemployment. As an economic impact analysis found this could build over 26 construction jobs if fully built out 8 permanent jobs and over a billion economic impact This legislation matters deeply to us, and we respectfully ask for your aye vote on AB 2163.
Do we have any other lead witnesses? Seeing none, lead opposition witness. Seeing none, me too. Seeing none, committee members. Senator Strickland moves the bill. Would you like to close?
Thank you, Madam Chair. AB 2163 has a simple goal, to help California identify and prioritize the regions that are best positioned to advance geothermal energy, critical mineral development, and domestic supply chain security. The reality is, in Imperial County, we have the opportunity to change the very landscape of not only the county, but of California. And you respectfully ask for an aye vote. And I respectfully ask for an aye vote.
Can we get a roll call, please? Motion is due past the Senate Appropriations Committee. Wahab? Aye. Wahab, aye. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Guerriero? Grayson? Aye. Grayson, aye. Minjavar? Aye. Minjavar, aye. Nilo? Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Strickland? Aye. Strickland, aye. Umber. All right. That bill's on call. Thank you. we're going to move on to our next item but I'd like to at least have file item number 4 can I get a motion please file item number 4 AB 1921 by Assemblymember Ward could I get a motion courtesy motion guys I'll do a courtesy motion thank you Senator Strickland moves the bill motion is due passed the Senate Appropriations Committee Wahab? Aye Choi? No Choi no Archuleta Adagin Cabriero Cabriero I Grayson Vintavar Milo Smallwood Cuevas Strickland Strickland no Umberg all right that bill's on call file item number six AB 1965 by Assemblymember Sharp Collins can I get a motion Senator Archuleta moves the bill motion is due pass the Senator Appropriations Committee. Wahab? Aye. Wahab, aye. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adeguin? Carriero? Aye. Carriero, aye. Grayson? Aye. Grayson, aye. Menjivar? Aye. Menjivar, aye. Nilo? Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Strickland? Aye. Strickland, aye. Umberg? All right. That bill's on call. Could we lift the roll for absent members on consent? Which again, just to be very clear, file item number 2, number 5, number 13, and number 14. Adeguin? Cabrero? Aye. Cabrero, aye. Nilo? Strickland? Aye. Strickland, aye. Amberg? I didn't vote on that. Did I? Yes. All right, consent's on call. We're going to move on to file item 7, AB 1990 by Assemblymember Gibson. Whenever you're ready.
Thank you very much. Chair and Senators thank you for first of all let me start off by thanking the chair for her patience and her support and allowing me to present this bill Don take it lightly Thank you for allowing me to present Assembly Bill 1990 which protects patients by ensuring compounded weight loss drugs are honestly or honestly marketed disclose potentially safety risk and are truthful rather than misleading. GLP-1 medications were originally developed to treat type 2 diabetics and weight-related health conditions, but they're effective and has led to widespread popularity beyond their original indication. Overwhelmingly number of ads of social media, people are buying compounded versions of these drugs at unprecedented rates. And we know this. These compounded versions are not and I want to repeat are not FDA approved and do not have the same requirements to ensure that these ingredients are final versions are tested for safety and purity. In fact, consumers see these compounded versions as interchangeably with the FDA approved drugs. For example, 71 percent of women surveyed in 2025 by the National Consumer League believed compounded weight loss drugs shots are tested, proven to be safe if they if they're on the market. And that's what they believe. Over half of the U.S. women believe compounded weight loss drugs are FDA approved. That's what they believe through the survey. Over the last several years, bad actors have exploited patients' desires to lose weight and have flooded the marketplace with compounded weight loss drugs that are unsafe. AB 1990 established a clear standard for advertising requirement by one, by prohibiting advertising that contains unsubstantiated claims to requiring disclosure for important safety information, including side effects, warnings for contamination. and requires requiring a summary of risk information associated with FDA approved drugs containing the same active ingredients and requiring clear disclosures that products in a compounded medication that has not been FDA and have not been approved or evaluated by the FDA for safety or side effects. Patients deserve to make sure information is healthy and also making sure that whatever they are putting in their bodies are safe and they are pure. The poster I'm about to show you is a prime example with permission by the chair. This is what we're talking about when it comes down to advertising. Hey girly hate needles, but want to shed on pounds willow has the has the GL one tablet and this is marketing to young girls That we see time and time again And this is something advertising that are misleading and this is being targeted to our children right now and this is what we're trying to prevent from taking place. And this is the advertising. The poster is one example of the predatory advertising campaign that target women and young girls. As you can see, the messaging centered on weight loss with no mention of side effects or at risk. Here with me to provide supporting testimony in support of 1990 will be, and they will self-introduce, is the director of the National Consumer League, and also the former FDA Office of Compounding Quality and Compliance.
Thank you. You guys will each have two minutes, and you will be timed. Thank you very much.
Thank you, Madam Chair. Thank you, members of the committee. My name is Gabrielle Cosell, and I'm here on behalf of Novo Nordisk in support of AB1990. My own background includes almost a decade with FDA's Office of Compounding Quality and Compliance, and prior to that, eight years with a few charitable trusts. Today, compounded weight loss drugs are being mass-produced and mass-marketed, flooding social media feeds every day. The scale of GLP-1 compounding is unprecedented. It does go well beyond traditional pharmacy practice, and regulators are struggling to address it. The tsunami of misleading ads is in the compounding weight loss space. That is why the bill focuses there. Despite existing prohibitions in the law on false and misleading advertising, ads for compounded weight loss drugs frequently contain unsubstantiated claims and no information on risks or side effects of the drug as normal drug ads do, and this is a really problematic discrepancy. These ads often also fail to make clear that the drugs are not vetted by FDA for safety and effectiveness. Multiple independent surveys show that consumers don't understand the difference between an FDA-approved drug and a compounded drug, as the assemblyman mentioned. The fact that these ads continue to proliferate demonstrates that we do need better specificity in the law, because without it, the law isn't sufficiently discouraging them. As a result, health care providers aren't getting key information to determine whether the risks associated with a compounded drug outweigh their unprompted benefits, and nor are consumers. A consumer seeing an ad for a compounded drug needs to understand they're not evaluated by the FDA and that they do have risks and side effects. Again, this information isn't in these ads right now. Even if patients get information about risks in a pharmacist consultation, although this may not be common with the telehealth model today in this space, it doesn't fix false or misleading advertising. An ad without safety information is still misleading to consumers. California should not punt on this issue. Consumers would benefit from having more specificity in the law, given what we're seeing in the marketplace. AB 1990 would give the specificity, and it's wholly consistent with existing FDA and FTC standards, and I urge you to vote aye. Thank you.
I think I need some help. I'm too short.
Good morning. I'm Nancy Glick. I'm with the National Consumers League. And I'm here today because the National Consumers League believes that AB1990 may be one of the most important consumer protection bills for this country. The reason why we are so concerned goes back to February 2025 when we issued a national alert and we told the public that compounded GLP-1 drugs are not FDA approved. We also use the words of the FDA which is that these drugs may contain the wrong ingredient or no active ingredient at all or they may contain too much or too little of the active ingredient This step is important because of the emergence of an exploitative Wild West marketplace where sellers use deceptive advertising to tout compounded GLP-1s as being as safe and as effective as branded medicines, only cheaper. The ads exploit consumers, and we are especially concerned about the number of teenage girls who are seeing these ads. To give another example of what the assembly member presented, the same company has an ad that targets young girls, shows that birthday cake, and has the words, Hey, girl, it's time to drop two pant sizes before summer. NCL calls this market America's second obesity crisis, and we do it for a reason. It is unprecedented in size and scope. To date, there have been 1,200 percent increase in violative ads that hinder the ability of consumers to understand the risk of compounded drugs. The result is serious. massive reports of dosing errors, overdoses, and serious reactions to harmful ingredients in these drugs.
Appreciate it. Do we have lead opposition witnesses? Two minutes each.
Good morning, Chair Wahab and members. My name is Tenille Davis, and I'm the Chief Advocacy Officer for the Alliance for Pharmacy Compounding. I'm a compounding pharmacist, a board-certified sterile compounding pharmacist. APC is the National Trade Association for Compounding Pharmacists and Pharmacies, representing more than 600 compounding businesses and over 5,300 pharmacists, technicians, prescribers, and suppliers nationwide, including many here in California. First, I want to acknowledge and thank the author for the significant amendments made to this bill. The bill has changed substantially. What began as a broad supply chain and sourcing bill is now much narrower and focus specifically on advertising for certain compounded medications used for obesity and weight management. We appreciate that narrowing. We also appreciate the inclusion of the requirement that advertisements clearly disclose that compounded medications are not FDA approved. APC supports this disclosure. In fact, that was part of the friendly amendments we previously submitted to the author. We also proposed additional consumer protections, including a prohibition on advertising compounded weight loss medications to minors, and we continue to support that concept. But despite this progress, APC still has concerns with the bill as amended. Our concern is now focused on one piece, the requirement that pharmacies use and summarize risk information from FDA-approved product labeling in advertising for compounded medications containing the same active ingredient. At first glance, that may sound reasonable, but compounded medications are not FDA-approved products. They're individualized medications that often differ in strength, dosage form, route of administration, or formulation. Requiring pharmacies to default to FDA-approved labeling creates a false equivalency between approved and compounded drugs and may require disclosures that are over-inclusive, under-inclusive, or simply not relevant to the actual medication being dispensed. And just as importantly, the primary enforcer of this bill would be the California State Board of Pharmacy. but many of the entities repeatedly pointed to as the reason that this bill is necessary
thank you next speaker
chairwoman members of the committee thank you my name is marie kottman i owned a California compounding pharmacy for over 20 years and I been actively involved in the development of compounding regulations for most of the time I'm here in opposition to AB 1990. While I fully support truthful advertising, this bill creates burdens that will directly harm patient access to customized care. I urge a no vote based on three realities. First, it confuses local pharmacies with manufacturers. Under Federal Section 503A, traditional compounding pharmacies are explicitly exempt from manufacturer labeling rules. We do not mass market brand name drugs. We prepare patient-specific medications prescribed by a doctor. Forcing a community pharmacy to distribute multi-page commercial package inserts just to communicate with doctors creates a de facto ban on telling physicians what we can formulate. Second, it restricts communication during critical drug shortages. While GLP-1 medications are on the FDA official shortage list, patients rely on us to bridge the gap. If a doctor asks if we can compound an alternative formulation, this bill severely penalizes my ability to provide clear information unless I fulfill unviable factory-level disclosure mandates. Third, California already has the tool to protect patients. California BPC Section 17500 already bans false advertising or misleading advertising. Furthermore, BPC Section 651 penalizes health care professionals who use deceptive marketing. AB 1990 does not stop bad actors or unlicensed out-of-state Internet websites, such as the illegal ad presented by Mr. Gibson. Instead, it will penalize compliant licensed California pharmacies that are trying to serve patients in need. Please protect patient access to customized medications and vote no on AB 1990. Thank you for your time.
Thank you. Do we have any Me Too's? Again, name, organization, support, or oppose.
Michelle Revis with the California Pharmacists Association in Opposition.
Madam Chair and members, Monica Miller on behalf of the California Naturopathic Doctors Association in Opposition. Thank you.
Kim Stone, Stone Advocacy on behalf of MidiHealth in Respectful Opposition.
Thank you. So seeing no other speakers, members of the committee, would you guys like to send it or mention it? As a member, both in your prop and your statement and the supporters, there was a big focus on advertisements towards minor. However, your bill doesn't touch anything on tailoring advertisements to minor. I'm wondering why that was utilized as the focus to support this bill when this bill won't do anything in those cases.
well if we this in terms of focusing on minors yeah you spoke a lot about you know look at this advertisements targeting minors the supporter also talked about targeting minors but your bill is silent on that so I'm wondering why that was the focus well we use this we use this because this is all the when you look at social media this is this bill this advertisement just another example of how they're using deceptive advertising and misleading advertising focusing not only on minors but also women so I we just grabbed this to show that it's very broad. Sure but your bill doesn't do anything around who to target and how to target your bill is asking to say that it's FDA approved or not and
add side effects. I'm still not understanding. So your bill doesn't preclude or alter how or who we advertise your P1 compounded drugs to it doesn't say that it can no longer advertise in a way that attracts to minors or it doesn't say anything around how we advertise
for women so I wondering why the focus is on that if your bill doesn touch anything on that This bill focuses on everyone Male this focus on females They targeting women girls who falls under women, that category. This bill is broad so it focuses on everyone and they're looking, there's a market, there's a market specifically targeting women, young girls, women and so this bill doesn't exclude, it includes
everyone. Maybe let me rephrase my question. Your bill is asking that advertising advertisements show side effects, show that it's not FDA approved and show and give consumer protection for the bill. The bill does not say you cannot advertise to minors or advertise in a way. Unless I'm I didn't see that
part. But it's what right I'm trying to say that this bill targets everyone it
It doesn't preclude. It includes everyone, including women. And children, this advertisement I'm showing you is just another example that it targets girls at a young age, almost like cigarettes, right?
Sure, but the advertisement would still be in existence if this bill passes. Only at the bottom it would say not FDA approved, and here are the side effects.
Right. Is that not? Please, through the chair. Unless I misunderstand.
Yes, but I also just want to highlight that in our committee analysis, we do mention that it creates a pharmacy-specific advertising standard that may duplicate existing prohibitions, which already makes it unlawful to disseminate advertising that is known or through the exercise of reasonable care should be known to be untrue or misleading. I'll let you guys add a little bit more to that, but I do want to highlight that it is correct.
Please go ahead.
Thank you. I'll just quickly address that. The California regulations do prohibit false or misleading advertising, but there isn't any specificity in California regulations about what information needs to be in an ad for a compounded drug such that it isn't false or misleading. And that's the sort of big thing that the truck is driving through right now. And that is why we still see ads without any risk information or side effects information. This is an issue that a really scary element of it is targeting minors, but it's not an issue just exclusive to minors. Everybody are getting these ads targeted to them. You see it in your social media feeds every day. Without risk information, without side effects information, that's a really problematic discrepancy compared to other drug ads that you see. I just wanted to make sure everyone's clear. This bill is not going to stop that practice whatsoever. It will add risk. It will prevent unsubstantiated claims. So in some of the ads, that one, including other ones that are not minors targeted, lose 15 pounds in a week. You can lose weight without going to the gym, which goes completely against the clinically supported indication, which says you need to do it concurrent with exercise. There are tons of unsubstantiated claims. So this bill would address that broadly in ads and at risk information.
You know, we've had a lot of bills on tobacco. Don't put dinosaurs. Don't put things that tailor. That's a specific. We don't want you to tailor advertisement to minors.
This bill doesn't do that. Yes, it adds a layer of this. What the bill? This is what the drug does or doesn't do.
But if it really I just felt like the conversation was going towards preventing, targeting kids. But nothing in the bill was preventing, targeting kids. I just want to bring us back to what the bill actually does. I appreciate that. It should be broad, and I think the broad changes will help in that space as well. As a member, I'm wondering if the whole goal is to protect and ensure consumers have all the information, why are you excluding physicians if that's another route where they get these drugs? Next.
So they can get these compound drugs only, yes, from physicians and from pharmacists. This bill is adding the added protections only if you get it from physicians. That's not the case. Pharmacists. this the bill applies to any person that's advertising anyone that chooses to advertise a compounded drug the bill applies to it's doesn't it's not limited in that way please so when i talked about it's okay is that from the previous version of the bill yeah it's been
amended significantly okay
I do also want to highlight that this bill will go to judiciary as well
I think I got clarity, but.
If you wouldn't mind. So in National Consumers League, we specialize in. The marketplace I was telling you about is almost all online. So you're able to buy things directly from a telehealth company. And you don't necessarily know your doctor. You don't necessarily talk to a pharmacist. So I do want to highlight you do have to have a prescription. You do have to have a prescription.
So I think that the senator received her answer and clarity, so we're going to move on. Senator Strickland. I want to thank the assembly member for what you're trying to attack here on this issue. I just had a couple things based on some of the opposition witnesses. Again, what I've read here, it says compounding medications are not FDA approved at all products. So if this was to pass prohibiting compounders from incorporating or relying on FDA approval to advertise, what it pretty much is going to do is say to these folks, the bill's advertising requirements would then put pharmacies in an impossible position because they would either comply with state law or they'll violate federal law. What would be your response to that? Because they don't do that right now. And you're saying in order to advertise, you need FDA approval, but they don't do FDA approval on these products. Right. And we're saying that when you look at, you know, 71 percent, and then I'll also ask my witness, when you look at 71 percent of the women surveyed, when they purchase.
I understand what your testimony is. In fact, I commend you for trying to attack this. But if FDA doesn't even do it, that pretty much says that this is going to be outlawed completely. No advertising on any of these. And that's what your goal is, to outlaw all compounds. We're not trying to do that, but we're trying to make sure that when people purchase these drugs, that it's pure and that it's safe and that it's FDA approved. But that's a point. FDA doesn't even they don't do this. Not at the present time. But they're so you're going to put them in a position to try to force the federal government, FDA, to do something that they don't do.
Right. OK. All right. We want we want to make we want to make sure. But we want to know. Well, what I want to make sure is that one, that people are not putting themselves at risk. I understand where you're going. I personally don't want to put something in law where the FDA doesn't do this in their purview from a state perspective. Let me ask my witness. Two different points getting made. Apologies. Thank you so much for consideration. No problem. Compounded drugs are not FDA approved. This bill doesn't suggest compounded drugs should be FDA approved, and it doesn suggest that compounded drugs need to put the entire FDA approved label even in an ad What it says is if a compound a drug includes as an active ingredient where there no risks you might know about those risks because there an approved drug where it has the same active ingredient there are risks You've got to identify those risks in your ad. That's all it says. But this bill does not require FDA approval. No, not at all, sir. And in fact, putting risk information in an ad is something FDA has already said should be in these ads. And if I may just go a step further, it talks about disclosure. If you look at some of the advertisement right now on television it's saying this drug may cause suicidal tendencies in this drug it may cause certain things that's what's going on right now with drugs that are are identified to help individuals but those that advertisement is letting you know if you take this drug this is what you should look for that's all we're saying we want people to know that this that this drug that you're consuming that you're taking will have these kinds of consequences or side effects I understand. So can I bring up the opposition really quick? Because based on your opposition witness or testimony, I thought I did I miss here? We don't have any problem with disclosures that compounded drugs are not FDA approved. They're not FDA approved. We do have a problem with requiring the labeling of the FDA approved drug to be used in advertisements that contain a compounded drug with the same API because it might have a different strength, a different route of administration, a different combination. It's requiring, so they get that information from clinical trials, the brand name drug companies. We didn't use those clinical trials to create a compounded drug. They're made for an individual patient. I'd also like to point out this ad wouldn't be fixed by this bill. The primary enforcers of this bill are the California Board of Pharmacy, who has jurisdiction over its licensees, which are pharmacies and pharmacists. Pharmacies and pharmacists, by and large, are not making these kind of advertisements in his prop here. It's typically direct-to-consumer companies, telehealth companies, and the entities of the like that wouldn't be solved by this bill at all. And I'd like to, again, just highlight the staff analysis. Yeah, yeah. No, no, no. So page 10 of 10, this bill requires every advertisement for only one type of compounded medication to include a summary of FDA-approved drug labeling side effects warnings and more stringent than California's general false advertising standard establishing a mandated disclosure regime rather than enhancing false advertising provisions. Again, there is a lot of leeway given to the states, so I just want to flag that. And Senator Choi, I think you had some questions as well. Yeah, I understand your intent of the bill of preventing false advertising. However, that is a very monumental technical problem. So who's going to monitor that and the judgment is that and also to label the side effects? Nobody will talk about the TV advertising side effects. So if you take this one, you will have a series of problems. So who's going to monitor that continuous false advertising, regardless of this bill, will continue? And the other question is that the opponents already stated that similar prohibition of false advertising exists. What's the difference between the existing law and your bill? The question is to the author. Right. You mind if I have my witness answer that? Sure. Thank you The false and misleading advertising prohibitions don have the specificity that this bill would add It doesn create a new paradigm It has specifics on what information needs to be in the ad It is a baseline standard requires you cannot have an unsubstantiated claim And if there are known risks you have to put those in the ad That really all it adds It doesn require porting in an entire label into the ad Okay, I won't be able to. All right. Seeing no other committee members, Assemblymember, would you like to close? Yes, thank you very much for the robust conversation and appreciate the questioning. We're trying to, again, look at and play some guardrails in this very serious, complex issue. That's why we brought Assembly Bill 1990 before you today, one with the misleading ads. We are trying to attempt to put some guardrails up. When this drug was first came up in our society, it was poised to address type two diabetics. We've seen an explosion where people can lose weight and we want people to get a leash on their health. And it has done wonders. But we also seen deceptive advertisement in our marketplace. And also we see we've seen one, some impurities as it relates to that. We want to make sure that one, that the deceptive advertisement does not continue. We want to put some guardrails up. We want to make sure that one, the deceptive advertisement, as I indicated through the questioning, we want disclosure. We want to make sure that people understand, one, what they're digesting. We want to make sure that people understand the effects and also making sure that the effects and the complications that it could, in fact, have if, in fact, people want to digest this. You would not believe the calls that have come through. People have taken these weight loss drugs and the effects that it has long term. We want to make sure that the misleading advertisement stops and there's some reinforcements in here. And Assembly Bill 1990 allows that to happen. I respectfully ask for an aye vote. Moving forward. Thank you. Do we have a motion? Senator Archuleta moves the bill. Motion is due passed. The Senate Judiciary Committee, Wahab? Aye. Wahab, aye. Choi? No. Choi, no. Archuleta? Aye. Archuleta, aye. Adagin? Gabriero Grayson Aye Grayson, aye Menjavar Nilo Smallwood Cuevas Aye Smallwood Cuevas, aye Strickland No Strickland, no Umberg Not willing All right, that bill's on call. We're going to move on to file item number 12, AB 2783 by technically Chair Calra, but going to be presented by Chair Umberg. Whenever you're ready. Thank you, Madam Chair. Unfortunately, you're stuck with the second string. I'm here on behalf of Assemblymember Chair Calra to present AB 2783 makes two changes to the law governing court reporters. First, existing law establishes the Court Reporters Board of California for the purpose of licensing court reporters Presently an applicant must pass the certified verbatim reporter or certified verbatim stenotype certification exam AB 2783 adds completion of the registered professional reporter certification administered by the National Court Reporter Association to the list of certifications that satisfy the dictation transcription component. Second, increased reciprocity with national court reporter exams will increase the pool of qualified court reporters at a time when we face a shortage of court reporters. Second, existing law established a pilot project authorizing Superior Court in 13 counties to study the potential use of remote court reporting, which is set to sunset on July 1, 2026. This bill extends the pilot until July 8, 2028. Indeed, we do have a very serious shortage of court reporters, and this bill helps to mitigate that shortage. With me here to testify, Michelle Caldwell, president of the California Court Reporters Association, and Yvonne Fenner, executive officer of the Court Reporters Board. I'd like to start up. My name is Yvonne Fenner. I'm the executive officer of the Court Reporters Board. We are co-sponsor of AB 2783, and I'd like to start by thanking the Assembly Judiciary Committee for helping us author that. And it's important because it does address a couple of solutions to the difficulty that some courts are having staffing their court reporter positions. The portion of the bill that allows the holders of registered professional reporter certification, which we call the RPR, comes from the National Court Reporters Association, and it's a consumer protection measure that removes barriers to licensure for court reporters in California. Existing law allows holders of the RPR to already sit for our license exam. Should this bill be successful in becoming law, holders of the RPR certification will not have to retest their skills portion, but instead only have to take the two written portions that are unique to California. This ensures that court reporters that pass our license exam have the requisite entry-level skills to practice here in California. We urge your support of AB 2783, and I'm available if there are any questions. Thank you. Good morning, Madam Chair. My name is Michelle Caldwell. I am a licensed court reporter in the state of California. I've been licensed for about 36 years. I am also the president of the California Court Reporters Association. We are a profession made up predominantly of women and women in small businesses. AB 2783 aligns with legislative efforts to continue to grow the profession and to remove administrative barriers to obtaining a California court reporting license. California currently recognizes certification by the National Verbatim Reporters Association as a means of satisfying the skills portion of the California exam. This bill would provide the exact same path for those who hold certification issued by the National Court Reporters Association. We are excited about this parity and look forward to welcoming qualified candidates to sit for California's written knowledge exam in order to become licensed. It's imperative to continued growth of the profession and our future in order to ensure all California residents have access to a verbatim record. In addition, 2783 continues a much-needed remote reporter pilot program necessary for testing the viability of remote reporting statewide in California courts. Thank you for your time, and we respectfully request your aye vote available for questions. Thank you. Do we have any opposition? Seeing none, me-toos. Seeing none, committee members. Seeing none. Thank you. Senator Umberg, would you like to close? Thank you very much, Madam Chair. Every lawyer who's ever tried a case knows the importance of court reporters. And also, all of us should be aware of the access to justice issue. The absence of court reporters works a serious, serious detriment to, in particular, family law, but many other areas. If you don't have a court reporter, you don't have an appeal oftentimes. And so it's critical that we do what's necessary to support court reporters. And that's what this bill does. I urge an aye vote. Thank you. With that, we have a motion by Senator Archuleta. Could we get a roll call, please? Motion is due pass to Senator Appropriations. Wahab? Aye. Wahab, aye. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Carriero? Grayson? Menjivar? Aye. Menjivar, aye. Nilo? Smallwood, Cuevas? Strickland? Aye. Strickland, aye. Umberg? Aye. Umberg, aye. How about I start? Okay, item number 12, AB 2783 will be on call. And moving on to next one is file number 15, AB 2771. Thank you. Again, by the committee. All right. I'm presenting on behalf of Assemblymember Berman. AB 2771 is the sunset vehicle for the Bureau for Private Post-Secondary Education. Specifically, this bill extends the sunset to January 1, 2031. Tightens accreditation and approval requirements for schools and programs. Requires school to notify the Bureau of certain events, such as bankruptcy. Prohibits school from withholding documents required for lunch or certification or relaxed or related to examinations because the student owes a debt. and makes a variety of other technical changes in policy reforms in response to issues raised during the Bureau's sunset review. I'm joined by Manila Vongmani and Elizabeth Elias from the Bureau to answer any technical questions. But with that, I think we can just move on. Do we have a support witness? Any opposition witness? any audience support or opposition, you can line up at the microphone and state your name and your position. Good morning, Chair members. Sara Abu-Abibsa on behalf of the Institute for College Access and Success and Support. Good morning. I'm McKenna Mustaza with NextGen California and also on behalf of Protect Borrowers, Young Invincibles and the Student Debt Crisis Center in support. Good morning. I'm Angela Williams, a public school teacher and a for-profit borrower from Brooks Institute. I am in support of AB 2771. Thank you. Thank you. Okay, if not, I will ask one more. Yeah, go ahead. Yes, hi. Melissa Cortez on behalf of the University of Phoenix No official position have a couple of concerns around Striff working with the author and the chair of the committee Okay thank you Any one question by the committee members? Move it. Okay. Motion has been made by Senator Atalara. Please call the roll. Thank you. Motion is due passes under education. Wahab? Aye. Wahab, aye. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Guerrero? Grayson? Menjabar? Nilo? Smallwood Cuevas? Strickland? Aye. Strickland, aye. Umberg? All right. That bill's on call. I do want to highlight that the rest of the bills are committee bills, so we are going to move through this quickly. and file item 16, AB 2772, Assemblymember Berman. Thank you, Chair and Senators. AB 2772 is the sunset bill for the California Council for Interior Design Certification. First of all, I am happy to accept the committee's requested amendment. While interior designers are not required to become certified in California, those who choose to obtain certification are granted the authority to use protected titles in their advertising. In addition to extending its sunset date by four years, this bill would recognize the Council's quasi-public status by requiring it to adhere to laws promoting accountability and transparency in state agencies. I respectfully ask for an aye vote on AB 2772. And with me today is Catherine Hampton with the Council to answer any technical questions that might come up. Thank you. Do we have lead opposition? Seeing none, lead opposition? Right over there and you will be timed. minutes. Good morning, Chair Wahhab and members. My name is Mary Oliver, and I'm here on behalf of the International Interior Design Association. We represent 1,800 commercial interior designers in California. We respectfully urge your no vote on AB 2772. I've been following this issue for years, and I have to ask, what is the purpose of a sunset review if none of the issues raised are ever addressed? Every time CCIDC comes before legislature, we hear the same promises. Every Sunset Review identifies the same problems, refusal to conduct open meetings, weak governance, poor accountability, outdated financial reporting, and failure to provide basic information about its own certification program. Yet nothing changes. Instead of fixing those problems, AB 2772 simply asked legislatures to give CCIDC another four years. Why? CCIDC as a statutory creation is mandated to have open meetings, and yet in two back-to-back Sunset Reviews, they have failed to address this issue. AB 2772 now proposes allowing this voluntary entity to charge civil penalties. Without open meetings, what is the appeal process for designers who have been charged a penalty? CCIDC's director does not live in the state, and the staff are not designers themselves, so they lack the basic requirements to provide any value to our profession. It has repeatedly struggled to provide accurate financial information and reliable data about certificate holders. The experiment of a voluntary structure for designers has failed. Let's stop pretending this is working. By keeping CCIDC in statute, you are providing your tacit approval that CCIDC works. There is no justification for continuing a statutory certification body that has repeatedly failed the legislature's own expectations. To Senator Menjivar's earlier point, this trust us process isn't working. AB 2772 is not a reform. It is another delay. We respectfully ask you to vote no on AB 2772 allow CCIDC to sunset and let California finally move toward meaningful reform Thank you Good morning Madam Chair and members of the committee My name is Chris Lynn Lounsbury and I am a certified interior designer in California. I earned my certification in 2007. At that time, the requirements included passing the NCIDQ, a rigorous nationally recognized exam that reflects the real complexity and responsibility of commercial interior designers. Today, that is no longer the case. The requirement has been reduced to the IDEX exam, a less in-depth California Pacific exam, so over time the standard tied to the certification has been lowered. And in nearly two decades since earning my certification, it has had little to no meaningful impact on my career. It has not expanded my scope of work, created new opportunities, or been requested by clients. The current system under CCIDC is not functioning in a way that meaningfully serves designers or the public. That concern is compounded when the organization responsible for certifying competency struggles with basic accountability and accuracy. Issues like lack of consistent public access to meetings and errors in testing materials related to life safety standards raise real concerns about oversight and reliability. Meanwhile, the work we do every day has only become more complex. I work within the California Building Code, Fire and Life Safety requirements, and Accessibility Standards. I make decisions every day that impact how people safely occupy buildings. There is a clear disconnect between the level of responsibility we carry and the system that is supposed to represent and regulate us. That is why I oppose the extension of the current CCIDC framework through AB 2772 and support moving forward with the Practice Act proposed in AB 1796. We should not preserve a system that has lowered its standards, lacks accountability, and has not delivered meaningful value. We should move toward one that reflects the real work, responsibility, and expertise of today's interior designers. We're going to move on to lead support witnesses. Good morning. I'm Catherine Hampton and I'm a board member of the California Council for Interior Design Certification. I am a certified interior designer with the commercial designation and I have my own firm and I pull permits. First I'd like to thank the chair, members, and committee staff for their hard work ensuring an effective sunset review process. We strongly support AB 2772 and respectfully urge the committee to approve it today. CCIDC approaches sunset review not only as an oversight function, but also as an opportunity for healthy self-examination for improvement. Having been through sunset review for five times, we believe CCIDC's reputation as an effective, efficient consumer protection entity is well deserved. I can unequivocally share that CDIDC is firmly committed to its consumer protection mission and to continuous improvement. Any and all recommendations or directives from the legislature are a top priority and are implemented with great care. We are proud of CCIDC's record. There is a very long list of all the program improvements, transparency measures, and public participation enhancements that have been implemented We understand that there is an incredibly small group of practitioners out of about 8 who seek to restrict the market and challenge CCIDC We welcome all feedback and are confident that CCIDC is honoring the public trust We appreciate that this bill makes two key improvements. One, it updates the definition of design professional to remove any doubt that plans must be accepted by building departments. And two, like the Architects Board, CCIDC will receive settlement judgment and arbitration award reports, which would allow them to keep a finger on the pulse of the marketplace and to make any reforms based on empirical data. Thank you. Thank you. Any other lead witnesses? Seeing none, we're going to move on to Me Too. Are you a lead witness? Okay. All right. Me too. State your name, your organization, whether you support or oppose. No other commentary will be accepted. Hello, my name is Holly Zara. I am with IIDA, and I'm also an interior designer with DG Architects, and I oppose the extension of CCIDC. Thank you. Good afternoon, committee members. Marcus Friedman, Administrative Director for the Consumer Protection Policy Center, in support. Tracy Godby, IIDA President in Sacramento, and I oppose the extension. Thank you. I'm Dominica Seke with Hayworth, and I oppose AB 2772. Thank you. Jonathan Chow with DLR Group, also NCIDQ qualified. We also urge you to vote no on AB 2772. Janice Placis, I am the secretary for CLCID, which is California Legislative Council for Interior Designers, and I support this. My name is Weiwei Sha, working in DGA Architects, and I oppose the extension of AB 2772. Thank you. Hi, my name is Steve Jones, certified interior designer since 1993, and I support this. Thank you. Eileen Sulzinger, a certified interior designer and I support. Hello, Patricia Johnson, certified interior designer and sustainability director and treasurer of CCIDC. I support 2772. Hello, my name is Sophia Mong. I'm a recent graduate of CSU Sacramento with a BFA in interior architecture and the former president of the IEDA Campus Center, also at Sox State, and I oppose. Hi, Laura Taylor, interior designer with DLR Group, NCIDQ certified, and I oppose the extension of the Sunset Review. Thank you. Damian Watson, interior designer at Two Furnish, and I oppose the bill. Adam Newton, interior designer in the Chairs District, and I oppose. Kristen Maganini, I'm a certified interior designer since 2012 and I support. Olga Zdenavich, interior designer and I support. Sally Midgley, an interior designer at APADEC Architecture and Interior Design and I oppose. I'm Lita Pham, interior designer, part of IIDA and I oppose. Thank you. Committee members? Thank you. All right. First and foremost, I do want to thank the author. I want to thank everyone who spoke. I understand that there is also a raffle for speaking as a Me Too of $500 in opposition of the bill. So just to put that on record, I do want to flag that occupational licensing also carries a significant ongoing financial obligation for many California professionals beyond the initial licensing process. In addition to education and examination requirements, many licensees must pay recurring renewal fees, complete mandatory and continuing education, and satisfy profession-specific training requirements to maintain active licensure. For example, according to the California Bureau of Real Estate Appraisers, certified residential and certified general real estate appraisers currently pay renewal fees exceeding $1,000 each renewal cycle and must complete 56 hours of continuing education every four years, including mandatory coursework and much more. I do want to say that California appraisers must maintain an active state license, pay substantial renewal fees, and complete extensive continuing education requirements in order to remain eligible to perform those transactions. You know, one of the things that we also wanted to say is mandatory state licensure standing alone does not guarantee greater professional advancement, higher compensation or increased marketplace recognition. In, you know, these types of professions, advancement in principally driven by education experience, technical expertise, successful project delivery, reputation, credentials, client demand and much more. You know, there I think was a lot of conversation here about our process. And obviously we have a sunset review process and much more. Would you like to kind of comment on that? Appreciate the folks who came in and testified today. Appreciate the comments of the chair. I just say, you know, eliminating the council wouldn't actually eliminate the private nonprofit. Right. It would just eliminate state oversight. It would eliminate title protection. It would eliminate, you know, the council having to abide by Bagley-Keene open meeting requirements. I don't think that eliminating the council is the solution to the concerns that are being raised by folks. And so I appreciate the concerns that they raise. I would strongly encourage the legislature to pass the sunset bill, AB 2772, for the California Council for Interior Design. And I want to be clear, the two things that have been discussed, your bill versus some of the comments, they're two separate things. Correct. Correct. Thank you. Yes, very much so. With that, could we get a courtesy motion? Yes. Thank you. Senator Strickland moves the bill. Assemblymember, would you like to close? Respectfully ask for an aye vote. Thank you. We have a motion by Senator Strickland. Can we get a roll call? Motion is due pass as amended to Senate Appropriations Committee. Wahab? Aye. Wahab, aye. Choi? Archuleta? Adagin? Caballero? Grayson? Menjavar? Nilo? Smadquivas? Strickland? No. Strickland, no. Umberg? All right. We're going to move on to that bill's on call. We're going to move on to final item number 17, AB 2773, by Assemblymember Berman. Thank you very much, Chair and Senators. AB 2773 is a sunset vehicle for the Board of Occupational Therapy. The bill extends the board until January 1, 2031, makes it easier for doctoral graduates to become licensed, authorizes the board to charge minor administrative fees, and makes other technical changes in response to issues raised during the board's sunset review. Respectfully ask for an aye vote. Thank you. Do we have any witnesses? That's a good question. Technical Maybe for technical questions For technical questions we can move on to opposition witnesses Seeing no opposition witness, we're going to move on to Me Too. Seeing none, members, opposition witness? No, support. Me Too? Me too and support. Okay, go ahead. Jessica Merrill with Capital Advocacy. on behalf of the Occupational Therapy Association of California and support. Thank you. All right. Committee members, seeing nobody comment, Assemblymember, would you like to close? Respect for the answer. And I vote. Thank you. We have a motion by Senator Strickland. Can we get a roll call, please? Motion is due. Passed to Senator Corporations. Wahab? Aye. Wahab, aye. Choi, Archuleta, Adagine, Carriero, Grayson, Menjabar, Nilo, Smallwood Cuevas, Strickland? Aye. Strickland, aye. Amberg? Thank you. That bill is on call. We're going to move on to file item 18, AB 2774, by Assemblymember Berman. Thank you, Chair and Senators. AB 2774 is a sunset bill for the Physical Therapy Board of California. First, I would like to accept the committee amendments. With the amendments, this bill would extend the board by four years, adjust fee caps, authorize the board to deny reinstatement petitions for serious offenses, and make other technical changes. And here with me for technical questions is John Kayser, Executive Officer for the board. Thank you for technical questions. We're going to move on to lead opposition. Seeing none, we're going to move on. Lead opposition? Yes, thank you. Two minutes timed. Thank you. Good morning, Madam Chair and members. I'm Dr. Keith Rohde, a small animal veterinarian at a nine-doctor general practice in Woodland. I'm also the co-legislative chair of the California Veterinary Medical Association. The CVMA does not have a formal opposed letter on record due to the lateness of the proposed amendments, but we do want to formally indicate opposition to the suggested amendment in the committee analysis pertaining to human physical therapists working on animals. As you know, for the past few years, there have been legislative attempts to create a path forward for human physical therapists to work on animals. The sponsors of those bills do not want there to be any oversight or supervision by a veterinarian. These PTs want to work completely independently. This is not sound policy as it has the potential to cause great harm to animals and create confusion for consumers. PTs are not trained to work on animals in their core curriculum, and their licensing examinations do not test for their proficiency to work on animals, in stark contrast to the curriculum and licensing examinations of veterinarians. PTs are not trained or equipped to respond to veterinary emergencies of patients in their care. When something bad happens to an animal patient being treated at their own facilities, like an animal going into respiratory distress, there's no 911 for dogs and horses that they can call in an emergency. The analysis suggests that the author should consider amending the bill to create a pathway for physical therapists to work on animals, and yet there is a current pathway. That pathway is spelled out in the Veterinary Medicine Practice Act, and it says that human physical therapists can work on an animal as long as they are at a registered veterinary premises and there is direct supervision by a veterinarian. Your analysis also seems to reinforce the need for direct supervision. This means that the veterinarian is on the property and can oversee the care and render emergency aid if that becomes necessary. That life-saving care could never be rendered at a physical therapist's office. Our beloved pets will be hurt by this proposed model, and the consumer will be duped in the process. Pet owners believe they are getting a level of care that they expect from a veterinarian's office, and yet simply they are not. We urge the author and this committee to reject amending this bill to allow human PTs to work on animals. Thank you. Thank you. Seeing no other... Yes. Sorry. Good morning, Chair and members. My name is Jessica Sieferman, the executive officer of the California Veterinary Medical Board Our board has not taken a position on this bill as I did not know until Friday analysis There was a recommendation to consider amending the bill to include animal physical therapy This is a highly controversial issue that has been discussed over the last two decades To add such a significant amendment in amending two practice acts to do it after the policy committee has heard the bill flies in the face of the entire legislative process. Please do not agree to add something this significant this late in the game. Instead, please wait until next session. Thank you. Thank you. We're going to move on to Me Too's. Please state your name, your organization, whether you support or oppose. Madam Chair, Carl London here on behalf of the California Physical Therapy Association. Just make a brief comment and support if you don't mind since you haven't had support comments yet. Support. Thank you. Next speaker. Thank you. Good morning. Grant Miller on behalf of the American Veterinary Medical Association, California Veterinary Medical Association, Sac Valley Veterinary Medical Association, and Southern California Veterinary Medical Association in opposition. Thank you. Thank you. We're going to move on to committee members. Senator Strickland. I actually thought that was coming up in the next item with the chiropractors, but the testimony from the veterinarians, look, pets are different than people, and a lot of the veterinarians have the experience of when you go through physical therapy or chiropractic, it's different on a horse and a dog, and especially the kinds of different animals in terms of the different kinds of dogs. Is that your goal in this, is to allow PTs or chiropractors in the next bill to go into that field? Because it doesn't make sense for me, and I wouldn't support it if that was the case. So I might – this is something that – a conversation with the Senate that we've been having. I might ask the chair to weigh in. Because I support – like I support what you're trying to do on everything, including the next item with chiropractors. But I am not for the PTs or the chiropractors because right now we do have a system that they have to have a vet who's trained. on animals specifically. And if it moves away from that, I can support that. Senator, we are not moving away from that. Okay. So we're going to continue with the current law that they have to actually have a vet who's trained to be present for physical therapy and the next one, a chiropractor. So as of right now, yes, that is correct. And I will say that a lot of what we've heard is in conversation and continuous conversation. So we may see a bill in the next year, in the next two years. I'm only worried about what's in front of me right now because I think a change of policy right now would be unacceptable for me. But if it's not changed, then I'll be supportive. Perfect. Okay. And there's no change in the bill. It's an issue that's brought up. Brought up. I understand. Yes. And can I bring up the vet, the vet opposition? Are you satisfied with that because it's not in this current language? It's just that things have been – And we can fight it another day if it's in a different bill. But here I'm hearing from the committee and the chair that it's not in this. Yeah, essentially our position is that without anything in writing, we don't have anything to write a letter in in opposition, but we wanted to state our opposition to that concept. Well, we've been crystal clear with the committee analysis and with the committee chair that it's not in this what's in here. And we might live to fight another day if that is a bill later on. Yeah, if the status quo is preserved, then we're in support of that. Okay, thank you. Any other speakers? Seeing none, Assemblymember, would you like to respond or close? Respectfully ask for an aye vote. Thank you. Really appreciate it. Do I have a motion to move this bill? Thank you We have a motion by Senator Strickland Motion is due pass as amended to Senate Appropriations Wahab Aye Wahab aye Choi Archuleta Adeguin? Carriero? Grayson? Aye. Grayson, aye. Menjavar? Nilo? Smallwood Cuevas? Strickland? Aye. Strickland, aye. Umberg? All right. That bill's on call. We're going to move on to file item 19, AB 2775, by Assemblymember Berman. Thank you, Chair and Senators. board, and I respectfully ask for an aye vote. Thank you. Do we have lead opposition witnesses? Good morning again, Dr. Grant Miller. On behalf of the California Veterinary Medical Association, we do not have a desire to stop a sunset bill. In light of what Senator Strickland said, it's going to be very much the same concept for us. We have problems with, obviously, many things with chiropractors and physical therapists, for that matter, encroaching on veterinary medicine. I want to make sure that those talks are given the due diligence that they need. I will not waste your time today giving every single reason, only so much as to say that we very much would like to continue conversations, maybe in another legislative vehicle at another time, where we have more of an ability to have an open dialogue about it and not Shanghai a sunset bill in the process. Thank you. Thank you. Next speaker. Good morning, Chair and members. Afternoon, I guess. No. My name is Jessica Sieferman, Executive Officer of the California Veterinary Medical Board. During our emergency meeting on June 15th, the board voted to oppose AB 2775 if proposed language related to animal chiropractic care was amended into the bill. The proposed language provided to the board had significant implementation concerns that need to be thoughtfully worked through, and we do not believe there is enough time to address all of the concerns in this session. The board also does not want to oppose the Board of Chiropractic Examiners' Sunset Bill. The BCE is necessary for consumer protection, and their bill has many important consumer protection improvements. Please do not include any amendments in AB 2795, and instead work with the Board, the Board of Chiropractic Examiners, stakeholders, and the public in a separate vehicle next session to ensure this is done thoughtfully and correctly for consumers. Thank you. Thank you. We're going to move, and I want to be very clear, some of the concerns about these amendments. The amendments are not here. They're not part of this bill. We do have Senate colleagues who have tried to bring this forward, and out of courtesy, we did include it in the analysis. Again, this is not part of the bill. Can we have our me-toos? So no lead. They've already completed, so it's just me-toos. State your name, your organization, whether you oppose or support. Good morning, Madam Chair. Megan Murray with the Weideman Group. On behalf of the California Chiropractors Association, we really appreciate the thoughtful analysis and would definitely support the amendment raised on page 9 about advancing the animal chiropractic framework. Thank you. Hello, thank you. My name is Dr. Emily McKillican. I'm from Folsom Chiropractic. Sorry, Folsom, California. And then I support if animal chiropractic language is included. Thank you. Hi, my name is Dr. Pam Riggs. I'm from the Sacramento area of California. I am in favor and support the animal chiropractic verbiage being included. Thank you. Thank you. Back to the members. Right. Again, I do want to highlight that that amendment is not in the bill. Assemblymember, would you like to comment in close? I respectfully ask for an aye vote. Thank you. Senator Strickland has moved the bill. Can we get a roll call, please? The motion is due pass as amended to Senator Appropriations Committee. Wahab? Aye. Wahab, aye. Choi, Pertuleta, Adagine, Caballero, Grayson? Aye. Grayson, aye. Menjabar, Nilo, Smallwood Cuevas, Strickland? Aye. Strickland, aye. And Umberg? All right. That bill is on call. Assemblymember, thank you. I've got one Gabriel bill that I'm supposed to be presenting. Perfect. We were not informed of that, but it's all good. In my mind, cutting down the talking points. File item number 3, AB 1915 by Assemblymember Gabriel, presented by Assemblymember Berman. Thank you, Chair and Senators. I'm pleased today to present, on behalf of Assemblymember Gabriel, AB 1915, a measure that will support California's neighborhood restaurants by cutting red tape and modernizing outdated regulations. Assemblymember Gabriel is happy to accept the committee's amendments. AB 1915 will support California's neighborhood restaurants by modernizing California's food facility code to reflect realities of how small businesses operate, amending outdated facility requirements around restrooms, ventilation, and equipment, and creating a streamlined permitting pathway to allow qualified contractors to certify routine equipment installations, making it less expensive to open and operate a restaurant. It does all sorts of other things. I'm happy to discuss in my close if necessary. We have some witnesses that will be very brief on behalf of the Independent Hospitality Coalition, Eddie Navarrete and Brittany Valles, an entrepreneur from Los Angeles. Thank you for making the trip up. Thank you. You will be timed at two minutes, and if you can go faster, I appreciate it. Good afternoon, chair and members. My name is Eddie Navarrete. I am the president of the Independent Hospitality Coalition representing a diverse network of small businesses across L.A. County. Our industry is not stabilizing, it is contracting. In Los Angeles, more than 84% of restaurants reported declining businesses last year, with many operators experiencing revenue losses between 30% to 80%, with many due to economic shocks, declining tourism, and reduced consumer spending. At the same time, the cost of doing business continues to rise across the board, including food, labor, insurance, and rent, all increasing faster than revenue, creating sustained pressure that small businesses are struggling to absorb. AB 1915 directly addresses a piece of that pressure that we can actually have the ability to fix. It removes the hidden costs embedded in outdated building and health codes, requirements that no longer reflect how businesses operate today but still drive thousands and in many cases tens of thousands of dollars in unnecessary expenses. This bill allows simple, like-for-like equipment replacements such as an ice machine or a stove to be replaced without months of delay. It eliminates construction triggers like additional restroom or ventilation systems where there is no measurable impact to public health. It updates outdated parts of our food code to reflect modern operations, including temperature monitoring, practical hand-washing standards, and flexibility for smaller or older spaces. Although these are minor technical changes, they are real cost drivers to determine whether a small business can open, reinvest, or stay in business. AB 1915 is also the result of meaningful collaboration with health regulators to identify where the code can evolve in a way that maintains safety while reducing unnecessary costs and delay, creating clear standards, improving consistency, and allowing enforcement to focus on real risks. At a time when vacancies are rising, small businesses are closing, and our local economies are under significant strain. This bill provides a practical and immediate way to reduce the cost of doing business and support the businesses our communities depend on. On behalf of the Independent Hospitality Small Business Community that I represent, I respectfully ask for your aye vote. Thank you. Thank you. Next speaker. My name is Brittany Valles. I am a seasoned restaurant owner and the executive director of the Independent Hospitality Coalition My coffee shop Tiago has been in business for just shy of 20 years And during that time equipment breaks I cannot stress to you the anxiety of receiving the text that the Espresso machine is not working for the 20th time, knowing that there are no more Band-Aid repairs and you've got to replace the machine. So what typically comes next is you buy the new machine, you have lost revenue while the machine is down, And because it's California, you have to hire a licensed contractor to pull the permit. That contractor then schedules an inspection. And in Los Angeles, that inspection can take an indeterminate amount of time. So that's a week or more of time where your staff is in limbo, your customers are confused, and your business is hemorrhaging money. And this is all even if you're just replacing one equipment with another. You're not roofing out any walls. You're not changing any fixtures. There's absolutely no construction being done. It's just a like-for-like change. This in our industry is what we are looking at as death by a thousand cuts. It's not something catastrophic. It's these little things again and again until you can't sustain. And it's why the state of California is losing restaurants at a record number and why so many of the restaurants that we love are walking away. So I respectfully ask for an aye vote for AB 1915. Thank you. So, me too's. or sorry lead opposition Rebecca May on behalf of the contractor state license board the committee amendments that are offered alleviate the board's concerns and I'm very happy to remove our opposed unless amended position on the bill want to thank the author the author's staff the sponsor and of course the committee staff on their thoughtful engagement with us thank you so much thank you any other lead opposition. Seeing none, me too. State your name, your organization, whether you support or oppose. Marlon Lahr with the California Restaurant Association in support. Thank you. Amanda Bloom with the California Association of Environmental Health Administrators in support. Sumana Haran on behalf of the California Travel Association in support. Madam Chair and members, Vince McKaylee on behalf of Los Angeles Area Chamber of Commerce in support. Craig Scholler on behalf of Panda Restaurants apologize for the letter of support and thank the author for the amendments. Thank you. The Ozanillo of Policy Insurance here with Ms. Abed of the group here on behalf of Inclusive Action for the City in support. Thank you. Seeing no other speakers, would you like to speak? Thank you, Madam Chair. Real quick, I just wanted to make a comment. Because it is California, we do believe in using licensed contractors to do quality work. However, pulling a permit shouldn't delay a project. Simply you're going to a counter and pulling a permit. So with that, I'd like to move the bill. Thank you. Assemblymember, would you like to close on behalf of Assemblymember Gabriel? I would like to thank Assemblymember Gabriel for the honor of presenting this bill for him. I was texting him, giving him a hard time. He reminded me he's chairing a budget hearing. So I suppose that's a legitimate reason. Respectfully ask for an I vote. Thank you. With that, we have a motion by Senator Grayson. Can we get a roll call please motion is do pass as a minute to Senate Appropriations Committee Wahab aye Choy Archuleta I'd again Carriero Grayson Grayson I'm in Javar Nilo small clevis Strickland umber all right that bills on call we're gonna move on to file item number 10 a B 2506 by Assemblymember Hart Whenever you ready Good morning Chair and Senators I want to thank the Chair and committee staff for their work on this bill I'll be accepting the committee's technical amendment. AB 2506 will allow the governor to voluntarily enter agreements with tribes to allow state licensees to obtain and sell cannabis products cultivated and manufactured by tribal licensees and vice versa. Under current law, operators with state cannabis licenses can only conduct commercial cannabis activity with entities that also have state licenses unless otherwise exempted. Tribes have, however, been traditionally locked out of operating in this new statewide legal market in any capacity. This bill will add tribes into the existing interstate framework for cannabis commerce, recognizing sovereignty while opening a voluntary avenue for increased market access. This bill adopts the existing strict guidelines around interstate licensee to licensee transactions for cannabis products, including rigorous standards for public health, testing, packaging and marketing. Several states, including Oregon, Washington, Nevada, New Mexico, Michigan and Minnesota, have already recognized these benefits and adopted similar systems with over 50 agreements already in effect. This bill will promote tribal self-sufficiency and economic development while reducing reliance on illegal cannabis sources by broadening the availability of regulated safe cannabis products for retailers and California consumers. This bill has received bipartisan support so far and no no votes. Speaking in support of the bill is Jason Gonsalves representing the 29 Palms Band of Mission Indians. Thank you. Madam Chair and members of the committee, Jason Gonsalves representing 29 Palms Band of Mission Indians. I would like to thank the author and the committee. The author did a great job of outlining the intent here and the fact that other states have entered into and allowed tribes to enter into the market. I would note that 29 Palms has worked very cooperatively with DCC and constructively, and DCC is aware of their efforts. They've toured the 50K facility, which is a 50,000 square foot fully automated indoor grow facility. and 29 Palms uses metric, the same testing, tracing, tracking that the state of California does, and we actually had to get DCC approval to embark upon that. So this is a cooperative and collaborative effort with the state of California. One, we hope the state can be proud of and tribal governments can be proud of. With that, we respectfully request your aye vote. Thank you. Thank you. Do we have any other lead witnesses? Seeing none, lead opposition. Seeing none, me too. Seeing none, committee members. Thank you. Assemblymember, would you like to close? I respectfully request an aye vote. Thank you. Thank you. And we have a motion by Senator Archuleta. If we can get a roll call, please. Motion is due pass as amended to Senate Appropriations Committee. Wahab? Aye. Wahab, aye. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Cabrero? Grayson? Aye. Grayson, aye. Mindabar? Aye. Nilo? Aye. Nilo, aye. Smallwood Cuevas? Strickland? Umberg? All right, that bill's on call. I appreciate your time. We're going to move on to file item number one, AB 1629 by Assemblymember Haney. While we're waiting for him to set up, can we call the members as well as Assemblymember Petrie Norris? Anytime. Hello again Madam Chair and members AB 1629 will help prevent patients from paying large upfront costs for out dental care by requiring insurers to pay dentists directly when a patient chooses to assign their benefits Every month, millions of Californians pay their monthly dental insurance bill but never get the care they are entitled to. California has over 35,000 active dentists. There are many dentists in California. but unfortunately some insurance companies narrowly exclude in-network services pushing patients to seek out-of-network care. Despite patients already obtaining assignment of benefits, non-contracting providers are largely excluded from receiving direct payments with insurance companies. 28 states have implemented assignment of benefits legislation that require insurers to reimburse dentists directly and California has fallen behind. These restrictions force patients to travel long distances for care or pay the full out-of-pocket costs due to inadequate provider networks and restrictive insurance policies. In most cases, patients would have to pay the costs up front and wait for prolonged periods to get reimbursed. Patients should not have to choose between paying large upfront costs or delaying dental care, care that can mean the difference between prevention and serious long-term health consequences. AB 1629 will end this limbo by requiring insurers to reimburse dentists with a written assignment of benefits regardless of their contracting status rather than requiring patients to pay high out-of-pocket costs up front and wait prolonged periods for reimbursement. We have had productive conversations with the opposition and other stakeholders. We've taken a lot of amendments on this bill throughout the process. I think we have more that are coming. And with me to testify in support of this bill is Eric Dowdy from the California Dental Association. Thank you, Madam Chair, members. Eric Dowdy with the California Dental Association, proud to sponsor AB 1629. Too many Californians pay for dental coverage they cannot effectively use. AB 1629 makes practical improvements that help patients use the benefits they already pay for and reducing barriers to care. First, the bill improves integrity of the dental provider networks by requiring plans to certify that the information they submit for network adequacy review accurately reflects providers serving their enrollees across all their lines of business. Second, AB 1629 requires dental plans to honor assignment of benefits. As the Assemblymember noted, the recent amendments strengthen important patient protections by establishing robust disclosure requirements so patients understand their financial responsibilities before receiving care. AB 1629 provides clear standards for professional conduct that the dental board can enforce to ensure cost transparency. These provisions protect patients while ensuring providers who accept assignment of benefits meet clear professional obligations. Assignment of benefits is a well-established policy. More than half the states require it in some form, and many plans, including Delta Dental, already administer assignment of benefits where it required, and in many cases voluntarily. AB 1629 represents a balanced approach that improves transparency, strengthens accountability, and helps Californians receive their dental benefits they already pay for. We respectfully ask for an iVote. Thank you. Do we have any other lead support witnesses? Seeing none, we're going to have lead opposition witness. Good afternoon, Chair and Committee members. My name is Sierra Feldman on behalf of Delta Dental in California and respectful opposition to AB 1629. We do appreciate the amendments that were taken in Senate Health and the continued conversations, but remain concerned about the impact that this bill will have to patients. To be clear, dental plans want to partner with providers. Strong, stable networks are essential to maintaining access and keeping care affordable, but this bill does put those networks at risk. Essential issue is the mandate of Assignment of Benefits, or AOB. Networks participation is a balanced experience where dentists agree to negotiated fees and consumer protections in exchange for direct payment and patient volume. Mandating plans to pay non-contracted providers directly without requiring them to accept those same terms undermines the incentive to participate in networks. The risk is real. Other states with similar policies have seen an average of a 7% decline in network participation. For patients, this means fewer in-network choices and greater reliance on out-of-network care, where costs are higher and protections are weaker. Under this bill, non-contracted providers could receive direct payment and still balance bill patients. If AOB is mandated, non-contracted providers who prioritize receiving direct payment should be required to accept that payment as payment in full, plus any cost sharing. Strong consumer protections are also critical. While this bill includes disclosure requirements, it provides no meaningful financial recourse when disclosures are incomplete or unclear, effectively shifting the financial risks of high unexpected out-of-network costs to enrollees. Finally, this bill shifts new oversight responsibilities to the dental board without addressing the resource demands likely from increased complaints. We share the goal of partnering with providers and protecting patients, but this bill shifts the risk to patients, leaving them less access, they'll pay more, and less protection. We respectfully urge your no vote when the time is right. Thank you very much. Thank you. Do we have any other lead opposition? I'll be quick, Chair. Mapback representing the California Association of Dental Plans. We do have an opposed position, largely based on the comments you just heard. Fundamentally, we are opposed to the state mandating that we have a business-to-business relationship that we don't have under contract today. So we would have to pay these folks, again, that we don't have a contract for, which would be mandated by this policy. Now, having said that, if it's going to become law, we need to make it workable. So we have tried to work, and thank you. We have worked with the author and the sponsors. They've taken a lot of amendments. So if it happens to become law, we want to make sure it's efficient for all involved, including the plans, the providers, and the enrollees. And I think we have a few more amendments to go, but we certainly appreciate everything today. Thank you. Thank you. With that, do we have Me Too's? Seeing none. Committee members? Okay. Come on, guys.
I'm Gary Cooper representing the California Academy of General Dentistry in support. Michelle Rivas on behalf of the California Association of Oral and Maxiofacial Surgeons in support. Jessica Hay with AFSCME California in support.
Thank you. Seeing committee members, Senator Grayson.
Thank you. Madam Chair, and thanks to the author for bringing this bill forward. I think the last speaker hit the nail on the head. There's some work still to be done when you're expanding in or kind of conjoining inward, in-network and out-network. network, by expanding it, it makes it a little bit more complex, and especially when there are already preset agreements and prices for different procedures, to be able to work through that and make sure that the consumer is made whole and protected at the same time is very important. So I think at this point, it's about making something implementable, and I'm sure you'll work with opposition on that. Yeah, absolutely. Through the chair, we've been working hard on that and as you heard from the witness, there's some more work to be done to make sure that we address those concerns about how to implement it. And of course our sponsors are the dentists themselves and know a lot about how this will work as well and we been very open around that and I think we made a huge amount of progress and I hope that we almost there Thank you I do want to highlight that in California especially around Medi the patients already suffer And, again, if you are on Medi-Cal, you are one of our poorest Californians. At a bill a number of years ago, SMILAC, Bipartisan, Bicameral, that literally said if you pull out a tooth, you should be able to replace it in something functional. and cost estimates were exaggerated and so forth, we need to do more around oral health. So I do appreciate this.
And Assemblymember, would you like to close?
Thank you so much to you, to the chair. And again, we're going to continue to work on this. And I think that we've had very productive conversations and amendments that are forthcoming as well, assuming this moves forward. And I appreciate the partnership on it and input and respectfully ask for your aye vote. Thank you.
We have a motion by Senator Grayson. Motion is due passed to Senate Appropriations Committee. Wahab? Aye. Wahab, aye. Choi? No. Forney. Archuleta? Aye. Archuleta, aye. Adeguene? Caballero? Grayson? Aye. Grayson, aye. Menjivar? Aye. Menjivar, aye. Nilo? No. Nilo, no. Moloquivas? Strickland? Umberg? All right, that bill's on call. We're going to move on to Assemblymember Petrie Norris with file item number 11, AB 2516. This is our last bill. I would ask the Senate sergeants to ask all members to show up. After this bill is done, we are going to take a roll call, and that will be done. Assemblymember, if you'd like to start.
Good afternoon, Madam Chair and members. Pleased to join you today to present Assembly Bill 2516. this bill will establish the California Grid Manufacturing Initiative in order to reduce the cost of critical grid equipment through coordinated bulk purchasing and expanded in-state manufacturing. As you all know, Californians are paying some of the highest electricity rates in the country. This is a topic that has gotten a lot of focus and attention and seen a lot of action from this body over the last several years. Something we haven't talked a ton about is actually a key driver of these costs, which is a supply chain crisis for the physical equipment that makes the grid work. Transformers, cables, switchgear. Demand has gone up by as much as 274% since 2019, and as a result, prices have spiked by between 45% and 95%. At the same time, lead times have stretched from weeks to nearly three years, leading more than 13 gigawatts of clean energy projects to be delayed because the grid equipment that they need is stuck in a bottleneck. So what this bill proposes is to take this set of challenges and turn that into an opportunity. So by creating the California Grid Manufacturing Initiative, the vision of this bill is that we'll work with utilities to identify which components are causing delays and then determine the right form of state help, from technical assistance to coordinated joint purchasing. Projected savings are in the billions of dollars over 25 years. And in addition to the opportunity for cost savings, we are also really excited about the opportunity for this initiative to create thousands of high-quality, good-paying union jobs. Building a reliable in-state manufacturing ecosystem is an important investment in California's long-term economic competitiveness. This bill will lower costs for ratepayers, create good jobs for Californians, and develop the supply chain that we need to build the grid our clean energy future demands Pleased to be joined today by Sam Appel from the UAW and by Madison Friedman from Heron Power Two minutes each
Pleasure to be here. Thank you for having me here today.
Sam Appel with UAW Region 6, representing 100,000 workers in manufacturing, higher education, state science, and other sectors. Our members want our taxpayer and ratepayer dollars to go towards building high-road, thriving manufacturing economies in our state, delivering on our climate goals, and bringing down prices from skyrocketing utility bills. Assemblymember Petrie Norris has brought forward a bill that tackles all three fronts. AB 2516 is an essential intervention into one of our most critical supply chains, electric grid equipment. Here's the problem. The supply chain for these goods is critically bottlenecked and delayed. In the words of my dad last night, we're in supply chain hell for this supply chain. According to analysts at Wood McKinsey and then to a report that we co-published with Blue Green Alliance and Climate Community Institute, demand for critical transformer types is up as much as 300% since 2019. And prices have doubled and tripled across critical technology segments. Lead times have grown to up to six years for specialized transformers. And this is all for standard equipment, nothing new or fancy. What does it all mean? According to economic modeling, it means if we don't make a dent in galloping inflation in this market, an extra $100 to $200 billion will be charged to our members' utility bills by 2050. 6.5 gigawatts of renewable power is also waiting to connect, and wildfire resilience decreases. We are a manufacturing union and we care about manufacturing jobs. This bill has the potential to create 5,000 direct manufacturing jobs in California and 12,500 stimulated jobs. Everyone agrees this industry needs intervention, and this bill has been developed by nation-leading experts and has a very clear theory of change. It's a solution that we need and we cannot afford to delay. Thank you.
Thank you. Next speaker, two minutes timed.
Hi. Good afternoon. My name is Madison Freeman, and I lead policy and market development at Heron Power, an advanced power electronics company headquartered in Scotts Valley, California. Heron builds advanced technologies that connect solar, battery storage, and data centers to the grid more efficiently, more cost-effectively, and with better performance than conventional equipment. We are also aiming to deliver much faster than conventional equipment. We've engineered our products here in California, and we're proud to say that we're scaling up manufacturing in the state as well. This year, we just signed a lease on a 286,000-square-foot facility in Morgan Hill, California, to transform a former alcohol distribution warehouse into a world-class advanced manufacturing hub. With the support of a Cal Competes Award from GoBiz and strong local government partnership, Heron's Factory Run will create more than 500 direct jobs. We chose to build here on purpose. This is where our talent is. We wanted to stay near our R&D hub. But I'll be candid, many hardware companies invent in California and then move their manufacturing elsewhere. where there may be greater access to financial support, shovel-ready sites, power on a near-time horizon, and lower-cost factory inputs. The question isn't whether California and Californians can invent these technologies. It's whether companies like ours can shape responsible business plans around building here and continuing to build. AB2516 helps answer that question. Coordinated procurement gives manufacturers like us clear demand signals. directing GO to prioritize grid manufacturing fills a gap in state energy priorities and lowering barriers through permitting support state partnership and other assistance keeps manufacturing in California rather than watching companies leave as they grow I just close with one observation The supply chain challenges that this bill addresses are not static. The grid is modernizing, and the equipment that utilities will need five years from now looks much different from what they're buying today or have bought historically. The most durable investments for California will be in companies and technologies positioned for the next generation of modern grid infrastructure, not only the equipment of the past. Innovation is one of California's...
Thank you. Appreciate it. Before we go on to our next opposition speakers, I'd like to just remind all members to come, this is our last bill and we will be voting one time. Lead opposition witnesses, two minutes each. Perfect. Me Too's.
Good afternoon, Chair and Members. Martin Vindiola on behalf of the Coalition of California Utility Employees and IBEW, Local 1245. Thank you.
In support. In support.
Thank you. Thank you.
Good afternoon, Chair and Members. Julia Lecheski on behalf of Industrious Labs in support. Thank you.
Good afternoon, Chair and Members. Elmer Lozardo with the California Federation of Labor Unions in support. Thank you. I'm seeing no other members speaking. committee members Senator Archuleta moves the bill assembly member would you
like to close thank you madam chair respectfully ask for your aye vote
perfect we have a motion by Senator Archuleta do pass to Senate Appropriations Committee Wahab aye Choy Archuleta Archuleta aye Adeguene Adeguene aye Cabrero Cabrero I Grayson Grayson, aye. Menjivar, aye. Nilo, no. Smallwood Cuevas, Strickland, no. Umberg, aye. All right, that bill is on call. We are going to wait two minutes. Madam Chair. Thank you. Thank you. All right, we're going to lift calls, and we're going to start with consent. And I want to be very clear. File item 2, AB 1640 by Assemblymember Stephanie. File item number 5, AB 1954 by Assemblymember Ward. File item 13, ACR 210 by Assemblymember Jackson. File item 14, AB 1767 by Assemblymember Berman. These have all been moved by Senator Grayson. We are starting with consent. So these four items are on call. Please lift the call. Heard votes 8-0. Adagin? Aye. Adagin, aye. Nilo? Consent? Yes. Aye. Nilo, aye. Umberg? Aye. Umberg, aye. That's 10-0 or 11-0. 11 to 0 that consent files are out File item number 1 AB 1629 by Assemblymember Haney Motion moved by Senator Grayson Can we lift the call Current votes four to one. Choi? Adagin? Aye. Adagin, aye. Carriero? Aye. Carriero, aye. Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Strickland? Umberg? Aye. Umberg, aye. Strickland no 8 to 2 8 to 2 that bill is out we're going to move on to file item number 3 AB 1915 motion made by Senator Grayson current vote is 2 to 0 Choi Archuleta Adeguin? Adeguin, aye. Carriero? Aye. Carriero, aye. Mindjavar? Aye. Mindjavar, aye. Nilo? Aye. Nilo, aye. Smalled Cuevas? Aye. Smalled Cuevas, aye. Strickland? Aye. Strickland, aye. Umberg? Aye. Umberg, aye. 10-0. That's all. Can I ask if you took the amendments on number 3? Yes, he did. Yes. I'd like to go back to I, if I may. Okay, Archuleta, aye. That's 11 to 0. 11 to 0. That bill is out. We're going to move on to file item number 4, AB 1921, by Assemblymember Ward. Motion made by Strickland. Current votes 2 to 2. Archuleta? Adagin? Aye. Adagin, aye. Grayson? Minjavar? Nilo? Again, this is AB 1921? Yes. No. Nilo, no. Smallwood Cuevas. Umberg. Aye. Umberg, aye. That bill is 4-3. That bill fails. Without objection, reconsideration will be granted. All right. We're going to move on to file item number 6, AB 1965 by Assemblymember Sharp Collins. Motion made by Senator Archuleta. Current votes 8-0. Adegeen? Aye. Adegeen, aye. Nilo? Aye. Nilo, aye. Umberg? Aye. Umberg, aye. 11-0. 11-0. That bill is out. Moving on to final item 7 AB 1990 by Assemblymember Gibson who has taken all our amendments motion by Senator Archuleta current vote is four to two Adegeen Adegeen aye Cabrero Cabrero aye Menjivar Nilo Nilo no and Umberg. Umberg, aye. 7-3. That bill has 7-3. That bill is out. We're moving on to file item 8, AB 2141 by Assemblymember Patterson. Current votes 5-1. Archuleta. Aragon. Aidegine, aye. Cabrero, Nilo, aye. Nilo, aye. Umberg, aye. 8-1. That bill is out. File Item Number 9, AB 2163 by Assemblymember Gonzales. Current vote 7-0. Adeguin? Aye. Adeguin, aye. Cabrero? Aye. Cabrero, aye. Nilo? Aye. Nilo, aye. Umberg? Aye. Umberg, aye. 11 to 0. That bill is out. We're moving on to file item 10, AB 2506, by Assemblymember Hart. Current vote is 5 to 0. Adeguin? Aye. Adeguin, aye. Cabrero? Aye. Cabrero, aye. Minjavar? Aye. Minjavar, aye. Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Strickland? Aye. Strickland, aye. Umberg? Aye. Umberg, aye. That bill is out. 11-0. Moving on to final item 11, AB 2516 by Assemblymember Petrie Norris. Current vote is 7-2. Choi? Smallwood Cuevas? Aye. Smallwood Cuevas, aye. 8-2. 8 to 2. That bill is out. We're going to move on to file item number 12, AB 2783, the Assembly Judiciary bill by Assemblymember Calra. Current vote 6 to 0. Adeguin? Aye. Adeguin, aye. Cabrero? Aye. Cabrero, aye. Grayson? Aye. Grayson, aye. Nilo? Aye. Nilo, aye. Smallwood Cuevas? Aye. Smallwood Cuevas, aye. 11 to 0. 11 to 0, that bill is out. We're moving on to file item 15, AB 2771, by Assemblymember Berman. This is a business and professions bill Carv votes 4 to 0 Adeguene Aye Adeguin aye Caballero Aye Caballero aye Grayson Aye Grayson aye Menjivar Aye Menjivar aye Nilo Aye Nilo aye Smallwood Cuevas Aye Smallwood Cuevas aye Umberg. Aye. Umberg aye. 11 to 0. 11 to 0. That bill is out. Moving on to file item 16. AB 2772. Another assembly business and professions bill. Current votes 1 to 2. Choi. 16. AB 2772. Okay, aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Aye. Adagin, aye. Carriero? Aye. Carriero, aye. Grayson? Aye. Grayson, aye. Menjivar? Aye. Menjivar, aye. Nilo? No. Nilo, no. Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Umberg? Aye. Umberg, aye. Nine to two. 9 to 2, that bill is out. Moving on to final item 17, AB 2773, another Assembly Business and Professions bill by Assemblymember Berman. Current votes 2 to 0. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Aye. Adagin, aye. Carriero? Aye. Carriero, aye. Grayson? Aye. Grayson, aye. Menjivar? Aye. Menjivar, aye. Nilo? Aye. Nilo, aye. Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Umberg? Aye. Umberg, aye. That bill is 11-0. That bill is out. File item 18, AB 2774, another Assemblymember Burman Business and Professions bill. Current votes 3-0. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Aye. Adagin, aye. Carriero? Aye. Carriero, aye. Minjavar? Aye. Minjavar, aye. Nilo? Aye. Nilo, aye. Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Umberg? Aye. Umberg, aye. 11-0. 11 to 0, that bill is out. Our final bill, file item 19, AB 2775 by Assembly Member Berman, another business and professions bill. Current votes 3 to 0. Choi? Aye. Choi, aye. Archuleta? Aye. Archuleta, aye. Adagin? Aye. Adagin, aye. Caballero? Aye. Caballero, aye. Menjavar? Aye. Menjavar, aye. Nilo? Smallwood Cuevas? Aye. Smallwood Cuevas, aye. Umberg? Aye. Umberg, aye. 10 to 0. 10 to 0. That bill is out, and our Business and Professions and Economic Development Committee is adjourned. Thank you.