Wednesday, April 3, 2019 at 11:48:29 AM Eastern Daylight Time

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04/03/2019 09:01 AM EDT

By KEVIN YAMAMURA ([email protected]; @kyamamura)

With help from Jeremy B. White, Angela Hart, Debra Kahn, Mackenzie Mays and Colby Bermel.

CARVING OUT DYNAMEX: Are business interests making a peace offering on the Dynamex labor bill, or is their latest "support if amended" position a negotiating tactic?

The Assembly Labor and Employment Committee will hold its first hearing on CA AB5 (19R) today in the Capitol. Two days ago, a coalition of business groups led by the California Chamber of Commerce issued a letter offering to support the labor-backed bill if it carves out a host of industries, writes POLITICO's Jeremy B. White.

Among the laundry list of sectors suggested in the letter are architects, engineers, lawyers, real estate agents, therapists, accountants, speech interpreters and translators, court reporters, barbers, hair stylists, newspaper distributors, taxi cab drivers, truck drivers, freelance writers and caterers.

Assemblywoman (D-), a staunch labor ally who is carrying the bill, told POLITICO that she saw that extensive compilation as more of a negotiating tactic. And for now, she's not buying it.

Gonzalez said her bill would "absolutely not" exempt all of the professions mentioned but said some "obvious exemptions" would be merited, including certain freelancers and some

Page 1 of 7 licensed professionals "who have the ability to self-negotiate and do act like small businesses." More at POLITICO California Pro

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California editor: Kevin Yamamura, [email protected], @kyamamura Health care reporter: Angela Hart, [email protected], @ahartreports Environment and transportation reporter: Debra Kahn, [email protected], @debra_kahn Energy and utilities reporter: Colby Bermel, [email protected], @ColbyBermel Education reporter: Mackenzie Mays, [email protected], @MackenzieMays

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HEALTH CARE

INDUSTRY FIGHT: A 2016 bill that prevented surprise medical bills for patients receiving non-emergency care has health plans and insurers jockeying with anesthesiologists over who has the upper hand in negotiations over billing, reports POLITICO's Angela Hart.

Anesthesiology groups say health plans and insurers, seeking to cut costs, are demanding anesthesiologists accept lower reimbursement rates, while health plans and insurers say it's the anesthesiologists that are demanding higher reimbursements.

Assemblyman Jim Wood (D-Santa Rosa) wants to address the problem, which the California Medical Association says has resulted in plans and insurers terminating contracts with anesthesiology groups if providers don't agree to lower payment rates. Wood is pushing a bill, CA AB1174 (19R), which would require health plans and insurers to contract with anesthesiologists as in-network providers. His hope is both sides will agree to a fair, in-network rate.

"The goal here is to create some stability in the marketplace," Wood said, as his bill

Page 2 of 7 cleared the Assembly Committee on Health Tuesday. "We want them both to (contract) fairly."

He characterized the bill as a mechanism to address what he called "unintended consequences" of Assembly Bill 72, which passed in 2016 and ended the practice of billing patients for out-of-network medical care at in-network facilities. The bill comes as anesthesiology groups have voiced increasing concerns, since the passage of CA AB72 (15R), that they are operating in what one anesthesiologist described as an "uneven playing field."

Health plans are opposed and are concerned that if they are forced to contract, anesthesiologists will get the upper hand and demand higher payment rates. More at POLITICO California Pro

EDUCATION

ON THE BRINK: The Sacramento City Teachers Association announced today that its members plan to strike next week, which would make Sacramento City Unified the third large California school district to face a walkout this year, POLITICO's Mackenzie Mays reports.

The one-day strike is scheduled for April 11 and comes while Sacramento City Unified is on the brink of state takeover amid a $35 million budget deficit. The union alleges that the school district violated terms of its contract signed last year, which included an agreement to downsize administration in order to save teacher jobs.

Superintendent Jorge Aguilar said in a statement he is willing to work with the union "to avoid insolvency and state takeover" and asked today to assign a neutral mediator to weigh in on negotiations. More at POLITICO California Pro

SENT TO THE DOG HOUSE: Assemblyman (R-Rocklin) has landed in the "Dog House" — the Capitol's smallest legislative office — after he rebuked the Assembly Education Committee for embracing a bill that would effectively ban Teach For America in California, reports POLITICO's Mackenzie Mays.

Kiley said Assembly Speaker Anthony Rendon moved him and his staff to the tiny office Monday after Rendon approached him on the Assembly floor "and used a great deal of profanity" in regards to his opposition to a bill that would block the national nonprofit from working in the state's low-income classrooms.

Rendon spokesperson Kevin Liao responded Tuesday in a statement: "No

Page 3 of 7 assemblymember is guaranteed a particular office. The Speaker has the authority to determine office assignments."

Speakers in past years have reassigned lawmakers to Room 5126 — almost always Republicans — as punishment for offending votes or actions. Past occupants began to consider it a badge of honor and even created a plaque to signify their assignment.

Kiley, a TFA alum, was the only lawmaker to vote against CA AB221 (19R) by Assemblywoman Cristina Garcia (D-Bell Gardens) at its first hearing last week. Proponents of the bill say that TFA unfairly places untrained teachers in front of the state's low-income and minority students — who need the most help. The bill was caught in a brewing clash this session between teachers unions and charter school advocates, though TFA says associations between its programs and the charter movement are often overstated. More at POLITICO California Pro

PARK AND SLEEP: Community colleges would be required to grant overnight access to parking facilities so that homeless students can sleep safely in their cars under a newly proposed bill that cleared the Assembly Higher Education Committee on Tuesday, Mays reports.

Assemblyman (D-Palo Alto), author of CA AB302 (19R), said the legislation is inspired by the state's growing housing costs that leave some college students unable to afford rent.

"The harsh reality is that students are already sleeping in their vehicles. When we do not provide a safe place for students to sleep, we force them into the shadows where they are most vulnerable," Berman said in a statement.

While no one has come out in formal opposition , the Community College League of California and some college districts have voiced concern about the costs of the measure. Colleges would need to increase security, custodians and employ staff to verify students' identification when entering parking facilities. The Los Rios Community College District said it is also concerned about liability. "Who is responsible for crimes, injury to homeless students, and medical emergencies?" the district asked in a letter to Berman. More at POLITICO California Pro

WATER

WETLANDS RULES: California water quality regulators Tuesday unanimously approved a sweeping update to their rules protecting wetlands and water from development, reports

Page 4 of 7 POLITICO's Debra Kahn.

The State Water Resources Control Board's wetlands policy is aimed at clarifying the state's wetlands definition and making sure that all nine regional water boards uniformly require landowners, developers and agencies to analyze and compensate for activities that could fill in wetlands or other state-protected waters.

Regulators billed the policy , in part, as a bulwark against the Trump administration's rollback of the Clean Water Act. The EPA is proposing to narrow the definition of protected waters under federal law, stripping Clean Water Act protection from millions of acres of wetlands and streams that an Obama administration rule would have covered.

But environmentalists at Tuesday's hearing pointed to a number of changes introduced since January's draft proposal that have watered down the final rule. The policy allows projects to avoid analyzing alternatives if the Army Corps of Engineers has already issued a general permit, and it exempts rice farmers from permitting to conduct any agricultural activity on their land, including converting farmland from rice to other crops.

The regulations create for the first time a uniform definition of wetlands, which the water boards use to determine what activities require permitting. The definition is stronger than the Trump administration's proposed changes, but not as strong as environmentalists would have liked, as it could exclude some types of wetlands that aren't periodically inundated. More at POLITICO California Pro

AND THE WATERS CALM: The path forward for the Colorado River Drought Contingency Plan got significantly smoother Tuesday evening when the river's largest user signaled it won't oppose authorizing legislation introduced in both houses of Congress with broad bipartisan support, reports POLITICO's Annie Snider.

The Imperial Irrigation District has refused to sign onto the deal without $200 million in federal funding to deal with the Salton Sea's environmental problems. But in a statement Board President Erik Ortega said "Congress stood with the Salton Sea" by altering the bill to maintain federal environmental protections and that the district "remains committed to the DCP process."

MARIJUANA

ORGANIC POT: A bill that would establish an organic certification program for California- grown cannabis has sailed through two policy committees, including the Senate Agriculture Committee Tuesday, writes POLITICO's Alexander Nieves.

Page 5 of 7 CA SB185 (19R) would require the California Department of Food and Agriculture and the California Department of Public Health to establish a certification system similar to the national and California organic programs for food and other agricultural products by 2021.

The bill had already been unanimously approved by the Senate Committee on Business, Professions and Economic Development and will now head to the Senate Appropriations Committee.

"Due to federal scheduling, the cannabis industry does not have access to the National Organics Program," said Terra Carver, executive director of the Humboldt County Growers Alliance, a cosponsor of the bill. "Only through the state program will we be able to create comparable standards and certify and market our California-grown products as organic."

The legislation would also close a loophole in the Medicinal and Adult-Use Cannabis Regulation and Safety Act that allows for inaccurate labeling of appellations of origin — or geographic identifiers — on product packaging. Currently, regulations allow products to display appellations of origins that sound similar to California counties and regions, even if they weren't grown there. More at POLITICO California Pro

ENERGY

UNION-SOLAR TENSIONS: A bill promoting union installations of energy efficiency projects could extend to solar power and limit its growth, a state lawmaker warned Tuesday.

CA SB524 (19R) would require energy efficiency projects receiving $50,000 or more in ratepayer-funded incentives to be built by a "skilled and trained workforce," writes POLITICO's Colby Bermel. The bill, authored by state Sen. Henry Stern (D-Canoga Park), is sponsored by the California State Association of Electrical Workers, California State Pipe Trades Council and Western States Council of Sheet Metal Workers.

But the bill's definition of energy efficiency could prove to be problematic for solar power unless it's revised, state Sen. Scott Wiener (D-San Francisco) told Stern at a Senate Energy, Utilities and Communications Committee hearing on S.B. 524, at which members approved the bill.

By having just union members install energy efficiency projects with $50,000 or more in incentives — be it upgrades to heating and cooling systems at a business, or potentially solar panels at a farm, apartment or bigger building, under the pending definition — that could shut out smaller companies from those jobs. Solar advocates say that would reduce

Page 6 of 7 the number of installers and decrease competition, all the while giving union shops greater control over solar's future.

S.B. 524 is similar to a recently approved effort by state regulators to possibly allow only unionized electricians to connect rooftop solar to battery storage, a decision opposed by solar companies and battery manufacturers. More at POLITICO California Pro

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