Government Affairs Committee Meeting. Wednesday, January 21, 2015 AGENDA

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1 Government Affairs Committee Meeting Chair: Alex Kasendorf (Alpert, Barr & Grant, APLC) Vice-Chairs: Vanessa Rodriguez (Fiona Hutton & Associates) Jan Sobel (West Valley Boys & Girls Club) Wednesday, January 21, :30 2:00 p.m.; Lunch served at 12:15 p.m. Providence Tarzana Medical Center, Clark St., Tarzana Women s Pavilion Auditorium 1. Welcome & Self-Introductions Lunch Courtesy of Providence Tarzana Medical Center 2. VICA Announcements & Updates AGENDA 3. Legislative Updates from Elected Official Staffers 4. New Elected Officials Introduction presentations by the offices of Senator Bob Hertzberg, Assemblymember Patty Lopez and L.A. County Supervisor Sheila Kuehl discussion 5. AB 31 (C. Garcia) State Legislators Residency Requirements discussion and action item 6. AB 44 (Mullin) Elections: Statewide Recounts discussion and action item 7. AB 67 (Gonzalez) Double Pay on Holiday Act of 2015 discussion and action item 8. New/Old Business 9. Upcoming 2014 Government Affairs Committee Meetings: Feb. 18, March 18, April 15 Conflict of Interest Policy: You must disclose a conflict of interest prior to speaking on an issue. This requirement does not prevent you from voting on the item.

2 AB 31 - State Legislators Residency Requirements Originating Committee: Government Affairs Date: January 21, 2015 Position: The Valley Industry and Commerce Association (VICA) supports/opposes Assembly Bill 31 (C. Garcia), which will clarify election law by saying that a person can only run for public office in the district in which their domicile is located, versus their residence. Background: A person s domicile is the place where a person s occupancy is fixed and where they intend to remain or return, if absent from there. A person may only have one domicile. A person s residence is where a person s occupancy is fixed for some period of time, but he or she does not intend to remain. A person may have more than one residence. In California, a person may vote in the district that holds their domicile, and subsequently, the domicile s address will also determine which district in which they may run for office. For example, a person may have a home in Van Nuys that is considered their domicile: Their spouse lives there and the kids go to school near there, etc. The person may also purchase a home in Sacramento for when they are in the Capitol for work. The Sacramento home is their residence during the Legislative Session but their domicile is Van Nuys, and so under the law they will vote in Van Nuys. Two area elected officials were recently in the spotlight for residency issues. Rod Wright was charged with falsely claiming he lived in Inglewood in 2007 so he could run for what was then the 25th Senate District. Prosecutors said he actually lived outside the district in Baldwin Hills. Richard Alarcon and his wife were charged with falsely claiming they lived in Panorama City in Los Angeles' 7th Council District so Alarcon could run for that seat in 2007 and Prosecutors said that the Alarcons actually lived outside the district in Sun Valley. In the wake of litigation regarding residency, the author felt that clarification was necessary in defining what a residence is for purposes of running for office. AB 31 clarifies the state law by stating that it is against the law to register to vote under your residence, not your domicile and therefore, a person s domicile is the only place where a person can run for public office, versus a residence. Under this law, Wright s and Alarcon s cases would have concluded the same way, but there would have been less ambiguity in the process of getting to that conclusion. Entities Impacted: Candidates, elected officials, California voters Business Nexus: Clarifying this restriction would affect who would be qualified to run for elected office in Valley districts, which affects who could represent our businesses in the State Legislature. Discussion: Support Argument: It is reasonable to want your elected officials to have their roots somewhat planted in the district that they represent. To that effect, it is unfair for candidates to plan a year or two ahead and falsely take up residence in a new district based solely on the fact that the district will soon have an open seat or their ability to win that district. This gives an unfair advantage to the rich and influential, who can afford to purchase another home to change their residency.

3 Opposition Argument: Our Congressional representatives do not need their domicile to be in their district and that has worked out fine. It is up to the voters to educate themselves about what the candidates have done for the district and decide for themselves whether it matters how long the candidates have resided in the district. Plenty of candidates have deep ties with neighboring communities where they necessarily do not live. Committee Discussion: Pending discussion in the Government Affairs Supporters: None submitted as of 1/14/15 Opponents: None submitted as of 1/14/15 Process History: Brought to the Government Affairs Committee on January 21, 2015: Pass Fail Tabled Amended Brought to the Government Affairs Committee on February 26, 2015: Pass Fail Tabled Amended

4 AB 44 - Elections: Statewide Recounts Originating Committee: Government Affairs Date: January 21, 2015 Position: The Valley Industry and Commerce Association (VICA) supports/opposes Assembly Bill 44 (Mullin), which requires the Secretary of State to order a state-funded manual recount for any statewide office or ballot measure where the margin of victory is one tenth of one percent or less. Background: Forty-three states permit a losing candidate, a voter, a group of voters or other concerned parties to petition for a recount. Twenty states and the District of Columbia have in place systems for automatic recounts in statewide elections. The triggers for recount vary by state, ranging from a difference of less than 0.1 percent of the total number of votes to a tie. In California, if a statewide candidate or ballot committee wants a recount, its own campaign must pay for the cost of doing so in the counties they want to recount. The Secretary of State estimates that a full statewide recount would cost roughly $1.9 million. It would be difficult for a campaign to raise that much money after an election to recount votes. Former Assembly Speaker John Perez petitioned for a recount in 15 counties after he fell 481 votes short of Betty Yee for second place in the June 3, 2014 primary. He called off the recount after a week of tallying votes. Yee went on to defeat Ashley Swearengin in the November general election. AB 44 would require the Secretary of State to order a state-funded manual recount for any statewide office or ballot measure where the margin of victory is one tenth of one percent or less. The bill also calls for automatic recounts in presidential elections. Entities Impacted: Statewide candidates, ballot measure committees, state budget, the Office of the Secretary of State, voters Business Nexus: An automatic recount may change the course of an election that will affect businesses for better or worse. Discussion: Support Argument: $1.9 million is a lot of money for a campaign to raise post-election in order to begin the recount. It creates an unfair advantage for the wealthier candidates and leaves candidates with smaller campaign chests helpless in a close race. It is the state s responsibility to ensure its statewide elections and ballot measures are counted in a credible, trustworthy manner and that voters are confident the actual winner rightfully takes office. Additionally, few races will qualify for such a close trigger threshold of 0.1 percent of the total votes and those are exactly the races that deserve a closer look. Opposition Argument: The state of California cannot afford to foot the bill of every recount that mets the trigger. If a candidate is in a tight race, he or she should budget in their funds the costs of a potential recount, just like they would budget for any other part of a campaign. Additionally, an automatic recount for the presidential election is completely unnecessary, particularly in a state like California where there has been at least a 10-percentage-point difference between the top two candidates since 1996.

5 Committee Discussion: Pending discussion in the Government Affairs Supporters: None submitted as of 1/14/15 Opponents: None submitted as of 1/14/15 Process History: Brought to the Government Affairs Committee on January 21, 2015: Pass Fail Tabled Amended Brought to the Government Affairs Committee on February 26, 2015: Pass Fail Tabled Amended

6 AB 67 Double Pay on Holiday Act of 2015 Originating Committee: Government Affairs Date: January 21, 2015 Position: The Valley Industry and Commerce Association (VICA) supports/opposes Assembly Bill 67 (Gonzalez), which would require California employers to pay employees twice their hourly rate on Thanksgiving and Christmas. Background: In California, an employee can work a maximum of 8 hours in one day to still constitute a normal workday. Any more than 8 hours in one workday or any more than 40 hours in any one workweek, or the first 8 hours worked on the 7th day of work in any one workweek must be compensated at the rate of no less than 1.5 times the regular rate of pay for an employee. Any more than 12 hours in one day as well as any hours beyond 8 on any 7th day of work must be compensated at the rate of no less than twice the regular rate of pay of an employee. A violation of these overtime wage provisions constitutes a crime. Massachusetts, Maine and Rhode Island are the three states that prohibit retailers from being open on major holidays. Many retailers stay open on Thanksgiving and Christmas in California, with either regular hours or special holiday hours. They are allowed to mandate holiday work but are not required to pay any special rates of compensation, unless the employee is working on the holiday under one of the above overtime requirements. However, many employers voluntarily pay their employees 1.5 or two times the regular rate on holidays. About one in four Americans worked on a holiday in 2014, be it Thanksgiving, Christmas, or New Year s Day, or some combination of the three. AB 67 would require California employers to pay employees twice their hourly rate on Thanksgiving and Christmas, regardless of number of hours worked. The law would not impact police, fire and medical providers and other unionized groups that already receive extra pay on holidays through their collective bargaining agreements. Entities Impacted: Employers open on Thanksgiving and/or Christmas, employees at those businesses Business Nexus: Mandated double pay on holidays creates extra costs and may affect which employees are willing to work on holidays. Discussion: Support Argument: Californian employers can mandate working scheduled overtime and holidays. However, while there are laws to compensate for the overtime, there is nothing to protect workers on the holidays. Employees who give up their holiday to work for us deserve extra pay. Additionally, businesses better employees are more likely to take a shift during a holiday if the pay is double. As a result, the service during these high-pressure days will improve, which is good for business. Opposition Argument: The intent of AB 67 appears to be to encourage businesses to close their doors on holidays so that people can spend time with their families hence why Christmas and Thanksgiving are worthy of double-pay but apparently not July 4th or Labor Day, etc.

7 However, there are plenty of businesses that must stay open on these holidays such as grocery stores and hotels. This burden on holiday-dependent industries will likely further inflate prices during the holiday season. Plus, businesses that voluntarily pay higher wages year-round will be severely penalized for this practice during Christmas, Thanksgiving and any holiday is added to this mandate in the future. They may be incentivized to provide raises if they have a lot of employees working on holidays. For example, hotels will soon be paying a $15.37 hourly wage in Los Angeles and then would be paying a whopping $30.74 an hour to its employees, if AB 67 were signed. Additionally, other businesses may choose to reduce hours or just close on Christmas or Thanksgiving in order to avoid this double-pay mandate. In that case, the employees are losing out on part or a full day of wages that they otherwise would have earned. This is a situation where the Legislature should let businesses decided whether or not to pay double on holidays in order to be more competitive in the hiring market. Committee Discussion: Pending discussion in the Government Affairs Supporters: None submitted as of 1/14/15 Opponents: None submitted as of 1/14/15 Process History: Brought to the Government Affairs Committee on January 21, 2015: Pass Fail Tabled Amended Brought to the Government Affairs Committee on February 26, 2015: Pass Fail Tabled Amended