CRA Member Newsletter- June 2023

CRA Member Newsletter

June 14, 2023 | CRA Newsletter: Legislative, Budget, Regulatory, Local, Political & Other Updates

Message from the President

It has been a whirlwind couple of weeks as we focused on the House of Origin deadline and the CRA team has been traveling to promote our programs focused on PAGA reform and Organized Retail Crime. Huge thanks to NRF for including CRA at the Employment Law Forum to discuss our efforts to reform PAGA and the NRF Protect where Ryan on the CRA team met with and answered questions about our efforts to combat retail theft and ORC in the state.

Speaking of retail theft, I have been very active on the media front highlighting a bill that passed the State Senate (SB 553) that will essentially eliminate the ability of loss prevention professionals in California to engage with individuals who are stealing from a store. While the author maintains that is not his intent, we have not seen clarification on this issue and are pushing the Governor to engage by encouraging the author to drop the bill and instead follow Cal/OSHA as we have been working with them on workplace violence regulations. I will be meeting with the Senator next week to share our concerns in more detail.

Another bill that we had hoped would not make it out of the first house was SB 707- the textile EPR bill. While we share the intent of what the author is trying to do, the bill is very complicated and will be difficult to implement. Additionally, the bill leaves the implementation details up to CalRecycle, which is currently still working through SB 54, which was passed last year. We have had direct conversations with the author, and I will be meeting with him again next week. It is my hope that we can convince him to make this a two-year bill and work on detail over the fall break. As a show of CRA’s willingness to work with him on this important issue, we are inviting the author for a special EPR workgroup meeting in the Fall as part of the 2023 CRA Annual Meeting.

While the House of Origin deadline was not kind to the business community – only one bill died on the Senate and two in the Assembly – the CRA team is actively engaging on several bills on behalf of the industry. I do hope you will take a moment and read through all the good work highlighted in the newsletter below.

As we look to the next few weeks the state legislature and Governor will debate the budget and how to resolve a $25 billion+ deficit. Look for some creative budgeting and negotiating. While the Assembly and Senate have agreed to a budget plan, the Governor has yet to sign off. In addition, we have our final deadline before we break for Summer Recess. July 14^th is the deadline to pass bills out of policy committees. Look for a busy week of negotiations.

As always, if there is anything I or the CRA team can do for you in California, please do not hesitate to reach out.

Rachel

In this Issue:

Legislative Updates
Regulatory Updates
CA Community Pharmacy Coalition Updates
PAGA Reform Updates
CRA Outreach, Activities & Other Updates
CRA In The News
Cal-ORCA Updates
CRA Member Portal

Legislative Updates

Workplace Violence Legislation

SB 553 (Cortese), passed out of the Senate and is now in the Assembly for second house policy committee review. This was not unexpected given the extreme uphill challenge we faced in light of the sympathetic topic (workplace violence) and super democratic majority. With the bill in the second house, we will need to work hard and quickly forewarn potential committee votes of our concerns. Despite its passage, CRA, along with a large business coalition, worked hard to spread the word on this bad bill, which has set us up for a strong opposition effort moving forward. Read the opposition letter here.

Additionally, CRA has leveraged our credibility with media as a go-to resource on the crime issue to talk about the impacts of this bill with prominent news outlets. Keep reading to see news coverage on this issue.

Additional House of Origin Updates

The legislature passed a majority of the bills by the House of Origin deadline. The CRA team is working on next steps for strategy and outreach regarding priority bills impacting our members and we will be following up with our legislative, policy and other subject area specific working groups. The following list includes highlights of important bills CRA is tracking for members. To view the full list of priority legislation click here .

AB 1347 (Ting) passed out of the Assembly and heads to the Senate for second house policy committee review. CRA is leading the opposition effort. Read a recent op-ed published in the Los Angeles Daily News opposing this bill here.
AB 747 (McCarty) was placed on the inactive file. CRA was actively lobbying against this bill that, which, among many other issues, would’ve prevented retailers from offering signing bonuses, college tuition aid programs and other employee benefits that would be redefined as a “debt.”
AB 1516 (Kalra) was placed on the inactive file. CRA was actively opposing this bill unless it was amended to include representation from the business community in the working group that would discuss minimum wage increases.

Credit Card Competition Act Reintroduced

The Credit Card Competition Act (CCCA) was reintroduced by Senators Richard Durbin, D-Ill.; Roger Marshall, R-Kan.; Peter Welch, D-Vt.; and J.D. Vance, R-Ohio, along with Representatives Lance Gooden, D-Texas; Zoe Lofgren, D-Calif.; Thomas Tiffany, R-Wisc.; and Jefferson Van Drew, R-N.J. In addition to the four original sponsors from 2022, four new sponsors have added their names to the bill in 2023. Press releases from NRF and the Merchants Payments Coalition on reintroduction can be read here and here. The bill was first offered in the Senate last July by Durbin and Marshall and in the House last September by Gooden and Welch (before he was elected to the Senate).

As a reminder, the CCCA would require credit card-issuing banks with over $100 billion in assets to enable a second competing network, other than Visa or Mastercard, to route transactions. The purpose of the legislation is to inject competition into the credit card routing market, which is estimated to save $11 billion in swipe fees annually.

SCA 7 Labor-Related Constitutional Amendment

Senate Constitutional Amendment 7, authored by Senator Tom Umberg and sponsored by the California Labor Federation, was recently introduced and aimed at appearing on the 2024 general election ballot. The measure enshrines in the California Constitution a provision that is viewed as unnecessary and provides unprecedented special benefits that will damage government operations and performance, destabilize the California economy, and is rife with unintended consequences.

SCA 7 would add three new substantive provisions to the California Constitution:

a right for all “Californians” to join a union and collectively negotiate with employers;
a right for all “Californians” to protect their economic well-being and safety at work;
and a prohibition on any state statute or local ordinance that interferes with, negates, or diminishes the right of employees to organize and bargain collectively over wages, hours, and employment terms and conditions.

Recent legal analysis shows the measure would have a devastating impact to private sector employment relationships, state and local government budgeting and the cost of doing business in California. Read the analysis here. Read the fact sheet here.

CRA is very involved in the opposition effort. Please reach out to Rachel with questions or if additional information is needed.

Grocery Bills

CRA is taking the lead on opposition efforts in the Senate with two major bills that would impact grocery and community pharmacy operations AB 853 (Maienschein) and AB 647 (Holden). CRA is collecting feedback from and meeting with our food and grocery committee to discuss strategy moving forward. If you are not on this committee and would like to be added contact ryan@calretailers.com.

Legislative Deadlines

June 15, 2023 Budget must be passed by midnight.
July 14, 2023 Last day for policy committees to meet and report bills. Summer Recess begins upon adjournment of session provided Budget Bill has been passed.
August 14, 2023 Legislature reconvenes from Summer Recess.
September 1, 2023 Last day for fiscal committees to meet and report bills.
September 5 - September 14, 2023 Floor session only. No committees may meet except Rules.
September 8, 2023 Last day to amend on the Floor.
September 14, 2023 Last day for each house to pass bills.

Regulatory Updates

CalRecycle Updates

SB 54

On May 31, 2023, CalRecycle hosted an informal rulemaking workshop on the topics of source reduction and responsible end markets for the Plastic Pollution Prevention and Packaging Producer Responsibility Act - SB 54 regs (link to public notice). The workshop included an informational session and provided an opportunity for public feedback on non-regulatory concepts related to the source reduction baseline and several rulemaking concepts on definitions and terms.

The slides are available here. The rulemaking concepts can be found in the linked source reduction discussion document and responsible end markets discussion document, along with suggested guidance for submitting written feedback. View CRA's May workshop recap here.

CalRecycle will host the next set of informal rulemaking workshops for SB 54 on June 28 and June 29, 2023. These workshops will focus on:

Individual compliance for producers
Recyclability and compostability determinations
The covered material category list
Requirements for local jurisdictions

The workshops will also include an informational session and provide an opportunity for interested parties to provide feedback on several rulemaking concepts. The CRA team will provide members the workshop materials ahead of time, once released by CalRecycle. Workshop times and content are still in development and are subject to change.

Additional Resources:

SB 1013

The CRA team attended CalRecycle's latest informal public workshop, which focused on the Glass Market Development Payment (GMDP) Program, created with the passage of SB 1013 - the California Beverage Container Recycling and Litter Reduction Act. The GMDP Program is similar to the Plastic Market Development Program, which CalRecycle has administered since 2007, however, unlike the plastic program, glass payments are only paid to manufacturers. Processors do not receive GMDP payments. Key takeaways from the workshop including next steps for the rulemaking process can be found here.

SB 1215

After the May 16 CalRecycle Monthly Public Meeting for the California Electronic Waste (CEW) Recycling Program, the Director approved to increase the combined recovery and recycling payment rate for CRT CEW to $0.98 per pound, the rate for non-CRT CEW to $1.10 per pound, and the recovery rate for all CEW to $0.35 per pound. The signed Request for Approval and supporting documents are available here. CalRecycle staff made the necessary filings with the Office of Administrative Law on May 18, 2023, to enact the rate increases.

Manufacturers of covered electronic devices (CEDs) sold in California must submit an annual Manufacturer Report on or before July 1, 2023. More information about the Manufacturer Report requirement can be found here.

Prop. 12 (Pork) Update

The US Supreme Court issued a ruling that upheld California's Prop 12 initiative. As the case made its way through the judicial system, California agreed to delay implementation of the regulations until July 1, 2023. With that date rapidly approaching, CRA has been engaging with relevant stakeholders to discuss how to best move forward.

The CRA team has met with representatives from the CA Department of Food and Agriculture (CDFA) and shared our concerns that the impact of a July 1 implementation date and enforcement would have on supply. We also talked through the enforcement which can be brought with a private right of action. CDFA did empathize that because the PRA was in the initiative it's out of CDFA's hands if a private citizen uses this enforcement.

The representatives from CDFA proved to us they are willing to work with retailers and other industries to ensure the implementation is as smooth as possible, acknowledging that the law is already written and there's not much they can do to delay implementation. We agreed to a larger virtual Q&A meeting with industry experts and CDFA. Additionally, CDFA has starting hosting a series of informational webinars to review the regulations including implementation. The first webinar, which focused on End-Users was held on June 6. Read the webinar recap here. The second was held on June 13 and focused on Distributors. Read the meeting recap here. The third, which will focus on Pork Producers, is scheduled for June 27. Register for that webinar here.

Reevaluation of Diphacinone

The Director of the Department of Pesticide Regulation (DPR) will begin reevaluation of pesticide products containing active ingredients diphacinone and diphacinone sodium salt. This reevaluation would involve 12 registrants and 56 pesticide products currently registered in California. A list of products proposed to be included in the reevaluation is available on DPR’s Diphacinone Web site. Comments on the proposed decision to begin reevaluation of diphacinone will be accepted through June 19.

View the Notice here.

CalSavers Mandate Expanded

CalSavers was created by state law to improve retirement security for Californians who don’t have a way to save for retirement at work. Under the law, employers are required to join CalSavers if they do not sponsor a retirement plan. On January 1, 2023, employers with as few as one employee became eligible to join CalSavers. Employers that do not offer a qualified retirement plan, and average between 1—4 employees in a calendar year, will be required to register by December 31, 2025. Read more.

Indoor Heat Regulation Update

The Cal/OSHA Standards Board met last month where the proposed Indoor Heat Illness Standard was discussed and public comment was heard. The Board’s 45-day comment period on the proposed Indoor Hear Illness Standard closed with the May 18 meeting with written comments submitted prior and oral comment during the meeting. We expect a final vote in late 2023 or early 2024. The revised text may be released by staff before that vote. A summary of public and board comments are below. Please email cra@calretailers.com with questions.

Public Comments:

On the employer side, many representatives (including myself) spoke about the flaws in the regulation, including highlighting: (1) the need for clarity and consistency with the outdoor heat regulation; (2) feasibility of providing the required cool-down space; (3) application of the standard to vehicles and other unanticipated spaces; (4) the need for an exception for brief exposures, such as below 15 minutes; (5) the need for a unique exception for hospital burn units; and others. The Chamber’s comment letter on this is attached for your reference.
On the labor side, many representatives from the fast food, logistics (delivery drivers), and warehousing industries spoke and pushed for the Board to approve the Standard (when it is voted upon in some months), and also urged its threshold trigger temperatures (82/ 87 degrees) be lowered to 80/85 degrees, or even below that point. They also pushed for expanded rest breaks, expanded training, and expanded recordkeeping. Notably, specific employers that were called out included UPS, Amazon, Jack in the Box, and others. Allegations were made of overheating and unsafe delivery vehicles, as well as warehouses without sufficient water and at dangerously high temperatures.

Board Comments:

Board Member Burgel supported labor proposals, with particular mention of lowering the trigger thresholds to lower temperatures, such as 78 degrees (which we would not like). However, she helpfully support some of our concerns, including: (1) supporting a duration exception (which we had pushed for) to ensure that short duration exposures do not trigger full compliance obligations; (2) seeking clarity between the mixed indoor/outdoor standard obligations.
Board Member Stock also spoke in support of lowering the thresholds for heat and including intensity of work as a concept.
Dave Harrison supported lowering thresholds as well (bad news for us) and incorporating intensity of work as a concept.

California Privacy Protection Agency

The CPP Agency met on Monday, May 15, 2023. Watch the meeting here.

“Potential Regulations Proposals” - these pertain to the regulations and outline which items they will take up first. View the chart here.

San Diego County

Indirect Source Rule Update

The San Diego Air Pollution Control District (SDAPCD) held a public hearing before the SDAPCD Governing Board to receive public comments on an update on strategies and options under consideration to reduce indirect source emissions from warehouses, distribution centers and ports in San Diego County.

Upon receiving the staff update and public comment, the Governing Board directed SDAPCD staff to pursue regulatory options for indirect sources of emissions for consideration and adoption at a future date- August 10, 2023- where staff are to return to the Board with a timeline for action. SDAPDC staff are also going to pursue an MOU with the Port of San Diego that includes emission reduction, facilitative and health protected mitigation measures and return to the Governing Board with an update by the end of 2023. The June 8 meeting minutes can viewed here. This item is near the bottom of the minutes report.

Copies of the report summarizing the potential options for consideration are now available and may be examined or obtained at the SDAPCD headquarters, 10124 Old Grove Road, San Diego, CA 92131, or by visiting the District's Rule Development website. A video summary of the item can also be found at here. Questions and comments can be sent to APCDRules@sdapcd.org.

City of Los Angeles Plastic Waste Reduction

The City of Los Angeles is considering the development of a citywide Comprehensive Plastics Reduction Program. The Solid Resources Citywide Division is collecting feedback on the proposed program and how the City of Los Angeles can reduce plastic waste. Click here for more information.

The City hosted two public meetings via Zoom to provide information about the proposed program, the PEIR process and additional ways to participate.

CRA signed on to a comments letter, which was submitted to the City last week. View the letter here.

Microplastics

The CRA team continues to meet with stakeholders regarding California's planned regulatory expansion of microplastics, which is in the beginning stages of the public process for a potential regulatory proposal expanding the list of chemicals that may be regulated under its Safer Consumer Products Program (SCP). Read the latest update we sent out here.

Free Trade

CRA joined the National Retail Federation and the American Free Trade Coalition in submitting a letter to the House Select Committee on the Chinese Communist Party (CCP) regarding how the punitive Section 301 tariffs on Chinese products continue to impact U.S. businesses, workers and consumers. The issue has become more urgent after the Committee’s most recent hearing – Leveling the Playing Field: How to Counter the Chinese Communist Party's Economic Aggression during which it was suggested that the Section 301 tariffs have been beneficial to the U.S. economy, businesses and workers and that they should remain in place or even be increased. View the letter here.

California Community Pharmacy Coalition Updates

AB 1286 Closing a Pharmacy

The CRA team and CA Community Pharmacy Coalition pulled out all the stops for getting this bill killed in the first house. Unfortunately, and as we expected, AB 1286 (Haney) was sent to the Senate. We reached an impasse with the Board of Pharmacy and UFCW leading up to the Assembly floor vote and, as such, the CRA team is working with the CCP Coalition to continue the opposition effort.

Board of Pharmacy

Due to CRA’s advocacy efforts, the California Board of Pharmacy released a policy statement allowing stakeholders to submit documents with digital signatures in lieu of a wet signature. View the statement here.

In addition, Governor Newsom reappointed Maria Serpa to the Board of Pharmacy. Details below:

Maria Serpa, of Elk Grove, has been reappointed to the Board of Pharmacy where she has served since 2018. Serpa was an acute care pharmacist and Senior Pharmacist of System Support for Sutter Medical Center from 1993 to 2021. She is a member and fellow of the American Society of Health System Pharmacists and the California Society of Health System Pharmacists and past President of CSHP. She earned a Doctorate in Pharmacy from the University of the Pacific. This position does not require Senate confirmation and the compensation is $100 per diem. Serpa is a Republican.

PAGA Reform Updates

As a member of the PAGA Reform campaign's Executive Committee, CRA President and CEO Rachel Michelin continues to fundraise and educate around the campaign efforts. The campaign recently released a Retailers version of the initiative video, which includes a breakdown of the initiative. Watch the video here.

Michelin also attended an editorial board meeting with Comstock's Magazine in Sacramento, presented on PAGA at the National Retailers Federation AP/LP conference NRF Protect and presented to Govern for California.

CRA Outreach, Activities & Other Updates

CRA President and CEO Rachel Michelin to Receive

2023 Business Makes LA County Work Award

Congratulations to CalRetailers' President and CEO Rachel Michelin for her 2023 Business Makes LA County Work Award (the Bizzis), which will be presented later this month by the Los Angeles County Business Federation. The Bizzis honor extraordinary business community leadership including leaders who lead small businesses to take on big advocacy challenges, head organizations that take a stand for entire industries, and serve in elected offices that consistently empower businesses to grow.

CRA Addresses Crime Issues at League Of Cities Meeting in Los Angeles

CRA's Director of Government Affairs Ryan Allain spoke at the League of California Cities' Los Angeles County Division General Membership Meeting regarding Retail Theft and Organized Retail Crime and CRA co-sponsored legislation AB 1708 (Muratsuchi), which did not get out of the Assembly Public Safety Committee earlier this year, but was held for reconsideration at a later date. Ryan was joined by Assemblymember Al Muratsuchi and the California Police Chiefs Association.

CRA President Attends California Chamber of Commerce's Annual Host Breakfast

CRA President and CEO Rachel Michelin attended the California Chamber of Commerce's Annual Host Breakfast, which which included keynotes from California Governor Gavin Newsom and Former Assembly Speaker and San Francisco Mayor Willie Brown. The event focused on issues facing California's business community.

CRA President Rachel Michelin Speaks at the

97th Annual World Trade Week

SoCal Kickoff Conference

CRA President and CEO Rachel Michelin spoke at the 97th Annual World Trade Week Southern California Kickoff Conference and shared engaging information about the regulatory issues and challenges faced by the regional supply chain. Rachel was joined by global trade panelists Paul Granillo, Vince Iacopella, Chris Shimoda, Lupe C. Valdez. CRA board member Fran Inman moderated the panel.

Additional CRA Team Activities

CRA President Michelin attended a Public Policy Institute of California (PPIC) Speaker Series luncheon and heard from PPIC President and Former Chief Justice Tani Cantil-Sakauye and guest speaker California Attorney General Rob Bonta.

CRA Director of Comms and Public Affairs Sarah Pollo Moo attended a professional networking luncheon with local Sacramento area communications professionals representing dozens of local business groups and trade associations.

The CRA team continues to work with NRF on bringing their RISE program to California.

CRA President Rachel Michelin attended a Moderate Democrats Caucus fundraising event.

The CRA team continues to play a leading role in planning the CSRA Annual Conference, which is coming to San Diego this August. Stay tuned for details.

CRA Monthly Policy Calls

The following includes the remainder of the 2023 monthly policy call calendar covering this year's legislative session (dates are subject to change). For CRA members' designated contacts who are not regularly receiving these policy call reminders and calendar invites, please email cra@calretailers.com to be added moving forward. Policy calls are held on Fridays at 11:00am PT (new time!).

July 14
No call in August
September 8

In The News