SACRAMENTO UPDATE – May 5, 2011

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from Kevin Pedrotti, Legislative Advocate for the Golden State Builders Exchanges
 

Legislature

It was a mixed bag this week for the many bills being worked on for GSBE.  Much of the regulation reform movement supported by business was bottled up in committee. Below is summary of some, but not all of bills acted on this week:

Fixed Priced Contracts

AB 780 (Calderon) – Fixed Priced Contracts – Failure to include a provision in the 2009 tax increase to address fixed price contracts has resulted in contractors having to unfairly absorb the tax increase for the last year and half. AB 780 provides that, in the event of a future increase or decrease in the state sales tax, public works contracts must provide for an adjustment in a contract that was entered into prior to the tax change to compensate the contractor for the increase that was not factored into the contract and compensate the public agency in the event of an unanticipated decrease in the sales tax. AB 780 was passed from the   Revenue and Taxation suspense file and move to the Assembly Appropriations Committee with some technical amendments to clarify the bill. Supported by GSBE.

Local Taxing Authority

SB 632 (Steinberg) – Local Taxation Authority - Authorizes the governing body of any county or city and county, or school district, subject to Constitutional voter approval requirements, to levy, increase, or extend the following taxes: A local personal income tax not to exceed 1% on any of all of the residents of the county or school district. A local vehicle license fee not to exceed 1.35%. An additional transactions and use tax which would             be excluded from the current 2% combined county and city rate limit.  The bill allows for local excise taxes but does not limit counties and school districts to these taxes. Specifically, the bill allows:  Alcoholic beverage tax of five cents per 5 ounces and at a proportionate rate for any other quantity. Cigarette and tobacco products tax of up to five cents per cigarette or $1 per pack. Oil severance tax not to exceed 10 % of the gross value of the product upon a producer for the privilege of severing oil from the earth or water in the county for sale, transport, consumption, storage, profit, or use, as authorized. Sweetened beverage tax not to exceed once cent per fluid ounce. Local medical marijuana tax. Passed Senate Governance and Finance Committee.

Regulatory Reform

SB 357 (Dutton) - Regulations: obsolete equipment- Requires a state agency, in adopting a regulation, to estimate the costs to the state in lost revenues resulting from a regulation that would make equipment obsolete that would otherwise have a remaining depreciable life. Passed the Senate Environmental Quality Committee, but substantially amended. Supported by GSBE.

SB 396 (Huff) – Regulation: Review process - Requires a system-wide review of state regulations to identify excessive or duplicative laws. This legislation will provide policy           makers with the objective information needed to identify excessive regulations and allow the state to take appropriate action to reform or repeal these regulations. Failed the Senate Environmental Quality Committee.  Supported by GSBE.

SB 400 (Dutton) – Regulation: Impact to Business -Requires a state agency to submit economic assessments for certain regulations to the Office of Administrative Law for a review and determination if the assessment is based upon sound economic knowledge, methods,           and practices. Failed the Senate Environmental Quality Committee.  Supported by GSBE.

SB 401 (Fuller) – Regulation Sunset - Specifies that every regulation proposed by a           state agency after January 1, 2012, shall include a provision repealing the regulation in five years. Failed the Senate Environmental Quality Committee.  Supported by GSBE.

SB 560 (Wright) – Regulations: small business - This bill makes a number of reforms to help small businesses grow by encouraging more realistic regulations and requiring a     genuine assessment of the actual costs of regulations to the business community. Failed the Senate Environmental Quality Committee.  Supported by GSBE.

SB 643 (Correa) – Regulations: Housing: Administrative Procedures -  Under the Administrative Procedures Act (APA), the bill 1) Requires the initial statement of reasons to               include the estimated cost of compliance and related assumptions used in determining the estimate if the proposed regulation impacts housing; and, 2) Requires information relating to the statement on housing costs to include estimated cost of compliance. Passed the Senate Environmental Quality Committee, as amended.  Supported by GSBE.

SB 688 (Wright) – Regulations: legislative approval - Requires a state agency to notify the fiscal and appropriate policy committees of the Legislature if the estimated cumulative statewide cost impacts of a regulation exceed $10 million for affected businesses, and delays the effective date for such a regulation. Failed the Senate Environmental Quality Committee.  Supported by GSBE.

AB 127 (Logue) – Regulations: effective date - Requires that a regulation or an order of repeal of a regulation become effective on the following January 1 after a 90-day period following the date it is filed with the Secretary of State, instead of 30 days after the date of filing. Failed Assembly Business and Professions Committee. Supported by GSBE.

AB 273 (Valadao) - Regulations: economic impact reviews - Requires the Department of Finance to review state agencies' determinations, estimates and other findings related to costs and economic impacts of proposed regulations. Passed Assembly Business and Professions Committee. Supported by GSBE.

AB 338 (Wagner) - Regulations: legislative validation: effective date.  Requires the Office of Administrative Law to submit a copy of disapproved regulations to the Legislature when certain criteria are met. Specifically, this bill increases from 30 to 90 days the effective date of a regulation or an order of repeal after the date of filing with the Secretary of State.

Passed Assembly Business and Professions Committee. Supported by GSBE.

AB 425 (Nestande) - State regulations: review -Requires each state entity that promulgates regulations to review those regulations, and repeal or report to the Legislature those identified as duplicative, archaic, inconsistent with statute or other regulations, or deemed to inhibit economic growth in the state by December 31, 2012. Passed Assembly Business and Professions Committee. Supported by GSBE.

AB 429 (Knight) - Regulations: effective date -Increases the number of days before an approved  regulation becomes effective from 30 to 180 after the regulation is filed with the Secretary of State, for regulations costing more than $15 million or that are a 5% increase over an existing regulation. Failed Assembly Business and Professions Committee. Supported by GSBE.

AB 530 (Smyth) - Regulations: economic and technical information-Requires agencies to include an economic impact statement with their initial statement for reasons for           adopting, amending, or repealing a regulation to the Office of Administrative Law. Passed Assembly Business and Professions Committee. Supported by GSBE.

AB 535 (Morrell) - Regulations: 5-year review and report - Requires state agencies to review and report specified information on regulations it adopts or amends on and after           January 1, 2012 to the Office of Administrative Law, five years after the regulation was adopted or amended. Passed Assembly Business and Professions Committee. Supported by GSBE.

AB 586 (Garrick) - Administrative regulations: legislative review -Requires standing committees of the Legislature, with jurisdiction over a state agency proposing to adopt a regulation with a gross cost in excess of $10 million as estimated in the initial statement of reasons for the regulation, to hold an informational hearing regarding the proposed regulation. Failed Assembly Business and Professions Committee. Supported by GSBE.

 

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