Welcome to the May 12-16 edition of the NFIB California Main Street Minute from your small-business advocacy team in Sacramento.

The Legislature

If he doesn’t do it today or tomorrow, Gov. Gavin Newsom must present his May revise of his proposed state budget by Wednesday (May 14). The prognosis is not pretty.

“California lawmakers are bracing for a $10B-plus budget hole — without federal cuts,” reports Politico. “Gov. Gavin Newsom and legislative leaders are now flying blind into budget crunch time.”

On legislation, four of the six worst bills for small business have been thrown into that dark hole called the suspense file where they either be quietly allowed to die or given a reprieve by the Senate Appropriations Committee warden. They are:

— Senate Bill 590 (Durazo), which would expand eligibility for benefits under the paid family leave program to any individual related by blood or whose association with the employee is the equivalent of a family relationship.

— Senate Bill 310 (Wiener), which would permit the penalty for wage theft to be recovered through an independent civil action.

— Senate Bill 555 (Caballero), giving cost-of-living adjustments for workers’ compensation recipients.

— Senate Bill 261 (Wahab), which would require the labor commissioner to post a copy of an order, decision, or award against and employer on the division’s internet website.

A hearing on a fifth bill, Senate Bill 809 (Durazo), another measure weakening independent contracting, has been postponed twice.

And, finally, the best news, so far, of the session is the failure of Senate Bill 222 (Wiener) to get out of the Senate Judiciary Committee. This lawsuit gold mine would have allowed anyone to sue any party they could accuse of causing a climate disaster.

Housing Update

Last Thursday’s (May 8) front-page story in the Los Angels Times about the latest poll results from the UC Berkeley Institute of Governmental Studies, gave the newspaper, which co-sponsors the poll, a chance to mention the progress of a bill NFIB is supporting.

The survey sampled 6,201 registered voters in the state and found the cost of living (35%), housing affordability (26%), and homelessness (25%) the top three concerns out of the 19 it polled for.

So, what’s being done?

“’Our task this session is urgent and clear,’ Assembly Speaker Robert Rivas (D-Hollister) told lawmakers at the start of the 2024-25 legislative session in early December. ‘We must chart a new path forward. And it begins by focusing on affordability,’” reported the Times.

“California is one of the most expensive states in the U.S. to buy or rent a home — the crisis has worsened in the last decade with rising housing costs and rent increases, and some laws such as the California Environmental Quality Act, or CEQA, have been used to stifle new development since the 1970s.

“Rent in California is 50% higher than the national median, according to U.S. census data. One in six middle-class renters in California are now spending over half their income on housing, according to the PPIC, a nonprofit research center.”

NFIB is backing Assembly Bill 609 (Wicks), which “… would exempt from the requirements of CEQA a housing development project, as defined, that meets certain conditions.” This would be a real, good start to doing something significant on housing, which must by necessity begin by increasing the stock.

Maybe this important change will come about. AB 609 has passed the Assembly Resources Committee on a 12-0 vote and the Assembly Housing and Community Development Committee on an 11-0 vote. It now is in the Assembly Appropriations Committee.

Think Twice About That Waterfront Property

“A long-feared monster earthquake off California, Oregon and Washington could cause some coastal areas to sink by more than 6 feet, dramatically heightening the risk of flooding and radically reshaping the region with little to no warning,” reports the Los Angeles Times.

“Those are the findings of a new study that examined the repercussions of a massive earthquake on the Cascadia subduction zone, which stretches from Northern California up to Canada’s Vancouver Island.”

Keeping an Eye on

Santa Cruz goes ahead with soda tax in defiance of state law

Calendar

— May 14: Deadline for the May revise of the state budget

— May 26: Memorial Day. Legislature not in session.

— June 6: Last Day for Senate and Assembly to pass bills introduced in their chambers.

— June 15: Budget bill must be passed by midnight.

— July 4: Independence Day. Legislature not in session.

— July 18-August 17 Summer recess.

— September 12, 2025-January 5, 2026: Interim recess of the 2025-2026 session of the California State Legislature.

— October 15: Last day for governor sign or veto bills passed before September 12.

National

Highlights from NFIB Federal Government Relations Principal Josselin Castillo’s weekly report

— DOL won’t enforce the IC rule. NFIB sent a statement following the U.S. Department of Labor’s (DOL) announcement that the 2024 final independent contractor rule will not be enforced.

— As federal regulators draft new regulations relating to WOTUS, NFIB sent a letter with recommendations to protect the nation’s waters while ensuring clarity and consistency for small businesses.

— NFIB Participated in a Small Business Roundtable hosted by the House Majority Whip as part of National Small Business Week. Our team highlighted, in no uncertain terms, the importance of making the 20% small business deduction permanent, along with other key priorities such as repealing onerous beneficial ownership requirements.

Next Main Street Minute, May 19. All Main Streets Minutes can be found on the NFIB website here. Pull down the California tab in the upper-right-hand corner.