Opposition Stops, Delays ‘Job Killer’ Bills

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JopKiller

Strong opposition from the California Chamber of Commerce and other business groups means several “job killer” bills won’t be advancing this year.

Short of Votes

Legislation to require warnings on certain sugar-sweetened beverages sold in California fell short of votes needed to pass the Senate Health Committee on April 29.

The CalChamber labeled SB 203 (Monning; D-Carmel) as a “job killer” because it would have exposed beverage manufacturers and food retailers to lawsuits, fines and penalties based on state-only labeling requirements for sugar-sweetened drinks.

Delayed to 2016

The authors of the following “job killer” bills have opted to delay consideration of the proposals until next year:

AB 244 (Eggman; D-Stockton) Private Right of Action Exposure. Jeopardizes access to credit for home mortgages, increasing the challenge to attract business to California because of high housing prices, by extending the homeowner’s bill of rights to others, thereby opening the door to more private rights of action.

The CalChamber pointed out the bill will lead to higher costs to purchase homes in the state through reduced access to credit.

SB 576 (Leno; D-San Francisco) Stifles Mobile Application Technology Development. Stifles innovation and growth in the mobile application economy and creates unnecessary and costly litigation by mandating unnecessary, redundant and impractical requirements that will leave many current and future mobile applications unusable, with no benefit to the consumer.

Mobile applications threatened by SB 576 include ridesharing programs and other industry and public sector applications that make use of real-time geo-location information.

SB 203: Soda Labeling

SB 203 would have required certain beverages to contain this warning: “STATE OF CALIFORNIA SAFETY WARNING: Drinking beverages with added sugar(s) contributes to obesity, diabetes, and tooth decay.”

The bill was very specific about the size of type, placement of warning and characters per linear inch on each product according to the amount of beverage contained. Vending machines, self-serve dispensers and sit-down restaurants all were to provide the warning.

SB 203 would have exposed manufacturers and retailers of sweetened beverages to significant liability. Consumers would have been able to sue for a violation of the labeling requirement under California’s Unfair Competition Law. A business therefore could have incurred a civil penalty of up to $500, and also would have had to defend itself against lawsuits.

It is conceivable that a class action lawsuit would have been filed based on the assertion that consuming sugar-sweetened beverages contributes to a person’s obesity, diabetes and tooth decay, and that companies would be held liable for millions of dollars of awards for a person’s choice to consume the beverage.

Manufacturers make and sell products nationwide and globally. SB 203 would have unfairly burdened companies with the requirement to label products specially for the California market. Small ethnic businesses would have been particularly vulnerable as more of their profits are from products made in other countries whose manufacturers might have chosen not to do a label just for the California market.

Key Vote on SB 203

The April 29 vote in Senate Health was 4-1, one short of the aye votes needed for the bill to pass:

Ayes: Mitchell (D-Los Angeles), Monning (D-Carmel), Pan (D-Sacramento), Wolk (D-Davis).

Noes: Nielsen (R-Gerber).

No vote recorded: Ed Hernandez (D-West Covina), Nguyen (R-Garden Grove), Hall (D-Los Angeles), Roth (D-Riverside).

Staff Contacts: Valerie Nera, Jeremy Merz

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Valerie Nera
About Valerie Nera
Valerie Nera specializes in advocacy on agriculture, water, resources, crime, and banking and finance issues for the CalChamber. She joined the CalChamber staff in 1978 as a legislative assistant on agricultural issues. She also has lobbied air, environmental and privacy issues for the CalChamber. She earned a B.A. with honors from the University of California, Berkeley, and a J.D. from the McGeorge School of Law, University of the Pacific.