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Bill signings send conflicting signals to California's struggling manufacturing community

Posted by Gino DiCaro, VP, Communications on Oct. 1, 2010

California's bill signing deadline passed last night.  The outcomes of a few specific bills send conflicting signals to manufacturers and private sector job creators about the state's interest in their ability to compete and grow jobs.

Here's a look at the result of four of the most important bills affecting the state's manufacturing job base and competitiveness:

Bad signal #1
AB 569 provides special treatment for some specific unionized industries by fixing 'meal and rest' regulations for only them and leaving a large majority of our private workforce and employers exposed to job killing lawsuits. This is a fix for a select and privileged few, without any justification, at the expense of every other non-union and union company in this state.  Gov. Arnold Schwarzenegger's signature likely ended any chance for a comprehensive fix.

This sends one of the worst signals possible to any manufacturer looking to locate or grow in California.

- CMTA's veto letter HERE
- Recent CMTA opinion HERE
- Can't post the Governor's signing message because he did not put one out when he signed the bill

Bad signal #2
SB 657 requires that all manufacturers report what they are doing to eradicate slavery and human trafficking from their global supply chains and allows the Attorney General to impose an injunction if he/she feels any disclosure is insufficient.  California's manufacturers are already part of many worldwide initiatives to improve working conditions and prevent abuses.  International human trafficking is not a state issue. The governor's signature on SB657 increases the cost of manufacturing in California and exposes manufactures to new costly litigation.

This is a feel-good bill that will have no impact on third-world human trafficking but will have a huge impact on the investment decisions of our high wage job creators.

- Gov's signature letter HERE
- CMTA's veto letter HERE


Good signal #1

SB 1272 requires personal income or corporation tax credits to contain automatic sunset or expiration provisions and detailed performance indicators to measure whether the tax incentives are meeting certain goals.  This is another bill that makes competitive tax policy very uncertain for manufacturers trying to make long and short-term investment decisions.  Why are performance metrics and "sunsets" ok for tax incentives but not for the the state's spending policies?

The Governor got it right on this one.

- Gov's veto letter HERE
- CMTA's veto letter HERE

Good signal #2

AB 1405 directs an arbitrary 10 percent of revenues collected by the California Air Resources Board from a cap-and-trade carbon program for undetermined purposes in a community benefit trust fund. They haven't even implemented cap-and-trade and the Legislature is already working on a "money grab". This is premature and will interfere with development of a potential cap-and-trade program. CARB must balance cost effectiveness, co-pollutant impacts, and technological feasibility as they develop regulations under AB 32. These criteria are vital to reduce greenhouse gas emissions and support the economy.

The Governor got this one right too and finally showed that the cost effectiveness of any AB 32 cap-and-trade program must be cost-effective.  Our next Governor must continue this oversight if California is forced to absorb a cap-and-trade program in the future.

- Gov's veto letter HERE
- CMTA's veto letter HERE

There are others (including an important career technical education bill, AB 2446, that should have been signed but got vetoed) but these are the bills that manufacturing employers have been calling on most over the past week, saying "Has he vetoed it yet?"  634,000 lost mnfg jobs and counting.

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More manufacturing loss and missed opportunity

Posted by Gino DiCaro, VP, Communications on Sept. 18, 2009

California's manufacturing jobs declined again in August.  This month there are 2,800 less high wage middle class jobs in California that could have played a role in our  economic recovery.  The total loss since January 2001 now totals 583,000 -- 31 percent of the state's original manufacturing base at the start of this century.

While we lose these jobs, California also suffers from too many missed opportunities for new growth.  An exponential amount of companies surveying the country for competitive places to manufacture have given up on California because of costs and unpredictability.  This must be turned around with laser focused policies for competitiveness and an articulated commitment to growing middle class jobs and the economy.

One week after the close of the state's legislative session, we can start with some important vetoes and signatures for Gov. Arnold Schwarzenegger to help keep the state's manufacturing base afloat.  Below are some of those important bills with CMTA's veto and signature request letters.

As we prepare for the second year of this Legislative session, the state's manufacturing losses must be at the forefront of concern in our economic recovery and one of the ultimate motivations for policies from our elected leaders.  Clear signals of California's commitment to manufacturing must come, and they must come fast. 

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Policy decisions bring out the best in Schwarzenegger

Posted by Gino DiCaro, VP, Communications on Nov. 2, 2007

After a long Legislative session -- one that still has not seen an official close with pending special healthcare and water sessions -- California manufacturers managed to escape some really bad policy ideas thanks to the Governor and his sound policy decision-making.  The Gov. only went against the manufacturers and the economy 6 of 29 times on important legislation that got to his desk.  Of those 6, none were deemed a priority by CMTA.  Most importantly  the Gov. vetoed the California-only instant rebate and the Family leave expansion bills.  Legislation that would have increased dramatically the cost of operating in California.
View pdf of the 29 bills.

On the Legislative front, 57 percent of the Legislature voted against manufacturing interests more than 75 percent of the time. 
View the 2007 Manufacturers vote record.

Along with the current healthcare and water negotiations, important legislation looms in the second year of this session. Career tech bills are still alive (such as SB 672 and AB 1414).  Meal and rest period regulation fixes are needed. Legislators will look to expand Family Leave even more. Liquefied natural gas permitting obstacles must be addressed to for increased natural gas supply.  California manufacturers still lack a sales tax exemption on manufacturing equipment and many many other important economic issues will dominate the Capitol Community in '08.

The Gov. did a great job making good policy decisions with his signatures and vetoes this year.  In '08, it's time the Legislature does the same with its votes.

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