Legislative Updates by Richard Markuson, PHCC of California Lobbyist

What Else’s On the November Ballot?

 In addition to the constitutional races we talked about last time, California voters will be asked to make six choices about major policy issues.

Proposition 1 – $7.12 billion bond for California’s water system. Californians last approved a water-related bond in 2006, known as Proposition 84. The measure authorized $5.4 billion in bonds for water projects. In 2005, voters approved Proposition 50, which issued $3.4 billion for water projects. Between 1996 and 2006, Californians approved about $11 billion in bonds for water projects. Proposition 1 in 1960 originally created the State Water Project that has been regularly replenished with additional water project bond votes since then.

Proposition 2 – Increase amount of potential savings in the state ‘rainy day’ fund from 5% to 10% of the General Fund. The amendment was originally slated for the June 5, 2012 ballot. However, Senate Bill 202, which was enacted on October 7, 2011, moved the amendment to the 2014 ballot. On April 16, 2014, Gov. Jerry Brown called a special session of the California Legislature to replace the ballot measure with a different one that also creates a rainy day fund. This replacement became known as ACA 1, was approved by the legislature.

Proposition 45 – Public notice required for insurance company rates initiative. Overall, the initiative would impose on the health insurance rate regulation system what Proposition 103 (1988) imposed on automobile and homeowners insurance.

Proposition 46 – Increase the cap on damages that can be assessed in medical negligence lawsuits to over $1 million. Increase the state’s cap on punitive damages that can be assessed in medical negligence lawsuits to over $1 million from the current cap of $250,000. Requires drug and alcohol testing of doctors and reporting of positive tests to the California Medical Board.

Proposition 47 – Reduces the classification of most nonviolent crimes from a felony to a misdemeanor. The initiative, if the state’s voters approve it, would reduce the classification of most “nonserious and nonviolent property and drug crimes” from a felony to a misdemeanor.

Proposition 48 – Ratification of gaming compacts with the North Fork Rancheria of Mono Indians and the Wiyot Tribe. This measure is a veto referendum; this means that a “yes” vote is a vote to uphold or ratify the contested legislation (AB 277) that was enacted by the California State Legislature while a “no” vote is a vote to overturn AB 277.

PHCC reminds its members and member employees to be sure to register and vote! Here are some important upcoming dates to remember:

National Voter Sentiment

Legislation

We reported last time that Governor Jerry Brown “signaled” he would sign AB 1522 the “sick pay for all” bill authored by Lorena Gonzales. A man of his word, he did at a press conference in LA. Brown touted California “becomes only the second state in the nation to require paid sick leave.” (Connecticut is the other) Hmmm – that doesn’t seem like a big feather in the cap of “business competitiveness.” The trend toward action hasn’t always been toward granting sick leave, though. Ten states (Georgia, Wisconsin, Louisiana, North Carolina, Tennessee, Mississippi, Kansas, Arizona, Indiana, and Florida) have enacted laws that prohibit cities, counties, and other municipalities from passing mandatory paid sick leave laws. At the federal level, the Democrat-sponsored Healthy Families Act is unlikely to be passed soon, meaning that employers can expect that sick leave will remain a patchwork of various laws and ordinances with potentially conflicting terms regarding coverage, accrual, and usage.

Brown did follow up this new mandate with signing AB 1839 that will increase the state’s film and television tax credit to $330 million a year for five years beginning with fiscal year 2015-16. Guess where all those Hollywood campaign contributions go. So in a sense, the taxes you pay, go to Hollywood moguls who in turn contribute to politicians who disagree with many of your core values of fair and open competition.

Recent Executive Orders impose new restrictions on government contractors

This week, the U.S. Department of Labor issued a request for public comment on proposed rules relating to a recent Executive Order that imposes new requirements on government contractors. Executive Order (EO) 13665 prohibits contractors from taking adverse actions against employees who discuss their compensation or the compensation of coworkers. The EO aims to decrease the salary disparity between men and women employees by allowing employees to discuss compensation with their colleagues. In its request for public comment, the Department of Labor lists various potential contractor benefits from the new rule, but also concedes that the rule will result in contractors paying increased wages to employees.

The new proposed rules highlight not only EO 13665, but several other recent EOs that create significant new obligations for contractors. Last month, the White House issued another EO requiring contractors to track and self-report adverse employment decisions. Under the rules to be issued pursuant to the EO, prime contractors will be responsible for checking the labor violation history of their subcontractors. Agency procurement officials will be given authority to debar contractors based on the number of labor violations listed in the reports – to be filed at a new government website created and maintained by the GSA.

Finally, the White House recently amended EO 11246 to add sexual orientation and gender identity to the list of grounds on which contractors are prohibited from discriminating. The new EO also requires that all federal contractors maintain policies forbidding discrimination against employees based on sexual orientation or gender identity.