THE ASSEMBLY, BANKING AND
FINANCE COMMITTEE IS CALLED TO
ORDER. SERGEANTS, IF YOU WILL,
PLEASE CALL ABSENT MEMBERS.
GREATLY APPRECIATE THAT WE DON'T
HAVE A QUORUM, OBVIOUSLY, AT
THIS TIME, BUT WE CAN START AS A
SUBCOMMITTEE. WELCOME TO THE
ASSEMBLY BANKING AND FINANCE
COMMITTEE. WHETHER YOU'RE HERE
IN PERSON OR WHETHER YOU'RE
WATCHING VIRTUALLY, I'M GRATEFUL
THAT YOU HAVE JOINED US IN ROOM
444. I DO WANT TO NOTE THAT WE
ARE ACCEPTING WRITTEN TESTIMONY
THROUGH THE POSITION LETTER
PORTAL ON THE COMMITTEE'S
WEBSITE, AND WE DO HAVE TODAY
SIX BILLS ON THE AGENDA. WE WILL
LIMIT TESTIMONY TO TWO MINUTES
FOR EACH PRIMARY WITNESS, AND
ADDITIONAL WITNESSES CAN SIMPLY
STATE YOUR NAME, ORGANIZATION
AND POSITION WITH THAT, IT IS
TIME TO MOVE ON TO THE HEARING
BEFORE US. AND BEING THAT WE
DON'T HAVE A QUORUM, WE WILL
PASS ON THE CONSENT CALENDAR FOR
RIGHT NOW AND MOVE INTO TO THE
AGENDA OF FILE ITEM NUMBER ONE,
SB 278 AUTHOR SENATOR DODD, THE
RECOMMENDATION IS DO PASS TO THE
COMMITTEE ON JUDICIARY. SENATOR
DODD, WHENEVER YOU'RE READY,
PLEASE. YOU CAN BEGIN WITH YOUR
OPENING STATEMENT. THANK YOU,
MR. CHAIR. AND MEMBERS. TO
BEGIN, MR. CHAIRMAN, I WANT TO
COMPLIMENT YOU AND YOUR
COMMITTEE CONSULTANT FOR DOING
AN AMAZING JOB, DRAFTING
AMENDMENTS THAT COMBINE INPUT
FROM NEARLY ALL THE STAKEHOLDERS
DURING NEGOTIATION WITH WHICH
TOOK PLACE THIS LAST YEAR. THANK
YOU VERY MUCH FOR YOUR HARD
WORK. SB 278 IS ABOUT PROTECTING
SENIORS FROM FINANCIAL SCAMS,
PLAIN AND SIMPLE. SB 278 IS
ABOUT UPDATING CURRENT LAW TO
MAKE CLEAR WHAT FINANCIAL
INSTITUTIONS WHO ARE MANDATED
REPORTERS OF ELDER ABUSE NEED TO
DO TO PROTECT ELDERS. WHEN RED
FLAGS SIGNAL A SENIORS BEING
LIKELY BEING SCAMMED AND WITH
RECENT AMENDMENTS, SB 278 IS
ALSO ABOUT PROVIDING BANKS,
CREDIT UNIONS AND OTHERS WITH
LIABILITY PROTECTION WHEN THEY
DO THE RIGHT THING TO PROTECT
ELDERLY PEOPLE AND THEIR
CUSTOMERS. ELDER FINANCIAL ABUSE
IS EVERYWHERE. THE LOSSES EXCEED
$23 BILLION ANNUALLY. ONCE A
SENIOR FALLS PREY TO FINANCIAL
FRAUD, THEY MAY NEVER RECOVER AS
MANDATED. REPORTERS BANKS AND
CREDIT UNIONS ARE WELL
POSITIONED TO DETECT WHEN AN
ELDER MIGHT BE THE VICTIM OF A
SCAM OR OTHER FINANCIAL ABUSE,
AND TAKE ACTION TO PROTECT
ELDERS FROM THE DEVASTATING LOSS
OF THEIR LIFE SAVINGS.
UNFORTUNATELY, OUR CURRENT
FINANCIAL ELDER ABUSE STATUTE IS
NOT AS CLEAR AS I THINK IT
SHOULD BE ON WHAT A BANK OR
CREDIT UNION SHOULD, WHAT STEPS
THEY SHOULD TAKE TO PROTECT
AGAINST SENIOR SCAMS. SB 278
WILL HELP PROTECT SENIORS BY
ENACTING A COMPREHENSIVE UPFRONT
SCAM PREVENTION POLICY FOR
CALIFORNIA BANKS AND CREDIT
UNIONS. I ALSO WANT TO MAKE IT
CLEAR SO THERE'S NO
MISUNDERSTANDING. THIS BILL
INCLUDES LIABILITY PROTECTION
FOR GOOD ACTOR BANKS AND CREDIT
UNIONS, BUT WE HAVE NOT YET
FINALIZED THE IMPORTANT ISSUE OF
ENFORCEMENT, WHICH WILL BE,
BROUGHT UP IN THE IN THE NEXT
COMMITTEE, THE JUDICIARY,
JUDICIARY COMMITTEE, AS A POINT
OF PERSONAL PRIVILEGE. I ALSO
WOULD LIKE TO THANK THE
FINANCIAL INSTITUTIONS FOR
COMING TO THE TABLE. I KNOW THAT
BOTH SIDES REALLY DIDN'T GET
EVERYTHING THAT THEY WANTED IN
THIS PROCESS, AND I REALLY
APPRECIATE THEM AS WELL AS ALL
THE OTHER STAKEHOLDERS, BOTH FOR
AND AGAINST, FOR COMING TO THE
TABLE AND AGAIN TO YOU AND YOUR
STAFF FOR DOING SUCH A GREAT JOB
WITH ME HERE TODAY IS ALICE LIN,
A VICTIM OF ELDER FINANCIAL
FRAUD. AND SHAWNA REEVES, WITH
THE LEGAL ASSISTANCE FOR SENIORS
IN OAKLAND. THANK YOU. THANK
YOU, SENATOR. AND TWO MINUTES
EACH. HI. GOOD AFTERNOON, MR.
CHAIR. AND THE MEMBERS. THERE
YOU GO. MY NAME IS ALICE LIN.
I'M 81 YEARS OLD AND A RESIDENT
OF ALHAMBRA, CALIFORNIA. I'M
HERE TO URGE YOUR SUPPORT FOR
SENATE BILL 278. I IMMIGRATE TO
THE UNITED STATES FROM TAIWAN TO
PURSUE AMERICAN DREAM. MORE THAN
50 YEARS AGO, BOTH MY HUSBAND
AND I WORKED VERY HARD TO RAISE
FOUR KIDS AND RAISE SAVE SOME
MONEY FOR OUR RETIREMENT. SINCE
MY HUSBAND'S PASSING, I'VE BEEN
TAKING CARE OF MY OLDER SON, WHO
IS ON DISABILITY. IN 2022, I
FELL VICTIM TO A SCAMMER WHO
CONVINCED ME TO WIRE THE MONEY
FOR INVESTMENT. SO I WENT TO
BANK TO ASK THEM TO WIRE THE
FUNDS. THEN I WENT OVER THERE.
NO QUESTION WAS ASKED, NO
HESITATION. THE BANKER SIMPLY
JUST GET MANAGERS APPROVAL AND
AWAY ALL THE FUNDS. AND I WENT
TO THE SECOND TIME AGAIN, NO
QUESTION WERE ASKED, NO INQUIRY
MADE. Ó, THEN 64, FIFTH, SIXTH
AND SEVENTH TIMES I WAS FAITHFUL
AND LONG-TERM CUSTOMER OF THE
BANK. DESPITE MANY. MANY RED.
KIND. TAKE YOUR TIME. TAKE YOUR
TIME. NO. ANY RED FLAGS? AND MY
BANK FAILED TO CONSIDER THAT I
MIGHT BE A VICTIM OF ELDER
FRAUD. AND THEY DID NOT EVEN
CONTACT MY DAUGHTER WHO IS A
JOINT ACCOUNT HOLDER ON THE
ACCOUNT. SO I END UP BEING
SCAMMED MORE THAN ALMOST ALL OF
MY LIFE SAVINGS. THREE QUARTERS
OF $1 MILLION IN LESS THAN THREE
WEEKS. HONESTY. AFTER THIS
HAPPENED, I WANT TO END MY LIFE
TODAY. I'M HERE. I'M TRYING TO
HELP TO PREVENT THIS FROM
HAPPENING TO THE OTHER ELDERS.
AS SENATE BILL 278 WILL HELP
PROTECT NEARLY 6 MILLION ELDERS
IN CALIFORNIA, IT WILL HELP TO
FIGHT CRIME AND WILL HELP TO ARM
BANK WITH A BETTER APPROACH. I'M
GRATEFUL THE BANK ASSOCIATION
HAS REMOVED THEIR OPPOSITION AND
IS WILLING TO DO RIGHT BY ITS
CUSTOMERS. THIS BILL WILL CHANGE
LIFE. IT MIGHT SAVE SOME. I URGE
YOUR SUPPORT AND I THANK YOU
FROM THE BOTTOM OF MY HEART.
THANK YOU FOR YOUR TESTIMONY. DO
WE HAVE A QUORUM? SO BEFORE THE
SECOND WITNESS SPEAKS, I WOULD
LIKE TO ESTABLISH A QUORUM IN
THE COMMITTEE AND WE CAN MOVE ON
FROM THERE. SO, SECRETARY, WILL
YOU PLEASE CALL ROLL? GRAYSON
HERE. CHEN CERVANTES. DIXON.
YES. HERE MIKE. FONG. BRIAN.
MAIENSCHEIN. PETRIE-NORRIS HERE.
BLANCA. RUBIO HERE. SORIA HERE.
WE HAVE ESTABLISHED A QUORUM.
AND THANK YOU FOR YOUR TESTIMONY
. AND WE WILL MOVE TO THE SECOND
WITNESS. TWO MINUTES, PLEASE.
GOOD AFTERNOON, MR. CHAIR, AND
MEMBERS. MY NAME IS SHAWNA
REEVES, AND I'M THE SPECIAL
PROJECTS CONSULTANT AT LEGAL
ASSISTANCE FOR SENIORS IN
OAKLAND. WE ARE ALAMEDA COUNTY
SENIOR LEGAL SERVICES PROVIDER.
I'M ALSO THE FORMER DIRECTOR OF
ELDER ABUSE PREVENTION AT THE
INSTITUTE ON AGING IN SAN
FRANCISCO. I'VE BEEN WORKING TO
PREVENT ELDER FINANCIAL ABUSE
FOR TWO DECADES AND FOR MANY
YEARS WHEN I TOLD PEOPLE WHAT I
DID FOR A LIVING, THEY WOULD ASK
ME TO DESCRIBE WHAT I MEANT BY
ELDER FINANCIAL ABUSE. NOT
ANYMORE. ELDER FINANCIAL ABUSE
NO LONGER REQUIRES AN
EXPLANATION, BECAUSE NOW ALMOST
EVERYONE HAS A STORY TO TELL
ABOUT A FRIEND OR A LOVED ONE
WHO LOST SUBSTANTIAL SUMS OF
MONEY TO A FRAUDSTER, AND MANY
OF THEIR STORIES SOUND LIKE
ALICE LIN'S. WE ARE MUCH CLOSER
THAN WE WERE JUST A FEW YEARS
AGO TO RECEIVING THAT HEART
WRENCHING PHONE CALL FROM OUR
PARENT OR GRANDPARENT, OR OUR
PARTNER, TELLING US THAT THEY
GAVE AWAY ALL THEIR MONEY TO A
SCAMMER WHO THEY THOUGHT WAS
PROVIDING MUCH NEEDED TECH
SUPPORT, OR WHO SHOWED ROMANTIC
INTEREST IN THEM, OR WHO HAD A
GREAT INVESTMENT OPPORTUNITY. WE
ALL HAVE A ROLE TO PLAY IN
PREVENTING ELDER FINANCIAL
ABUSE. WE CAN EDUCATE OURSELVES
AND WE CAN RAISE AWARENESS WITH
OUR LOVED ONES. FINANCIAL
INSTITUTIONS, WHICH ARE MANDATED
REPORTERS OF THIS ABUSE, HAVE
ESSENTIAL ROLE TO PLAY AS THEY
ARE PERFECTLY POSITIONED TO
DETECT SUSPECTED FINANCIAL ABUSE
OF THEIR SENIOR ACCOUNT HOLDERS.
SB 278 FOLLOWS THE RESEARCH AND
ADVICE OF THE EXPERTS, INCLUDING
THE FBI, THE AMERICAN BANKERS
ASSOCIATION, THE CFPB AND AARP,
ON HOW BEST TO STOP SENIORS FROM
LOSING THEIR LIFE SAVINGS TO
SCAMMERS. IT PROVIDES A CLEAR
ROADMAP FOR FINANCIAL
INSTITUTIONS TO FOLLOW IN ORDER
TO PROTECT THEIR SENIOR
CUSTOMERS FROM FINANCIAL RUIN.
SB 278 WILL SOLIDIFY
CALIFORNIA'S POSITION AS THE
LEADER IN PROTECTING OUR SENIORS
FROM ELDER FINANCIAL ABUSE,
WHICH IS WHY I RESPECTFULLY
REQUEST YOUR AYE VOTE. THANK YOU
AND THANK YOU FOR YOUR
TESTIMONY. ARE THERE ANY OTHERS
IN SUPPORT IN THE ROOM? PLEASE
STEP FORWARD. STATE YOUR NAME,
ORGANIZATION AND POSITION.
PLEASE CHRISTOPHER SANCHEZ WITH
THE MESA VERDE GROUP, ON BEHALF
OF THE CALIFORNIA CONSUMER
FEDERATION. CINDY YOUNG,
CALIFORNIA ALLIANCE FOR RETIRED
AMERICANS AND STRONG SUPPORT.
I'M STAN WONG WITH CARA, AND I'M
IN STRONG SUPPORT OF IT. K¾T
WEBER, VICE PRESIDENT CARA,
STRONG SUPPORT. THANK YOU. GOOD
AFTERNOON, DANNY KENDALL KAISER
ON BEHALF OF THE CO-SPONSORS,
CALIFORNIA LOW INCOME CONSUMER
COALITION, AS WELL AS A NUMBER
OF OTHER, ORGANIZED WITH THE
CHAIR'S PERMISSION, MAY I PLEASE
READ IF IT'S SHORT? YES. THANK
YOU. I'LL KEEP IT SHORT. REYES
ECONOMY. BET. TZEDEK. LEGAL
SERVICES, LEGAL ASSISTANCE FOR
THE ELDERLY. OPEN DOOR. LEGAL.
PUBLIC COUNSEL, PUBLIC LAW
CENTER, RIVERSIDE LEGAL AIDS,
SANTA CLARA LAW. WATSONVILLE LAW
CENTER, CENTROLEGAL DE LA RAZA
COMMUNITY LEGAL SERVICES IN EAST
PALO ALTO. CONTRA COSTA SENIOR
LEGAL SERVICES, ELDER LAW AND
ADVOCACY, AND LEGAL AID OF
MARIN, AS WELL AS LEGAL
ASSISTANCE FOR SENIORS OF
OAKLAND. THANK YOU. THANK YOU
VERY MUCH FOR YOUR TESTIMONY.
ANY OTHERS IN SUPPORT? SEEING
NONE, WE WILL NOW GO TO THE. WE
HAVE NO REGISTERED OPPOSITION,
BUT WE WILL NOW MOVE TO
WITNESSES, WHO ARE EITHER IN
EITHER NEUTRAL OR IN OPPOSITION.
IF YOU WANT TO STEP FORWARD AND,
YES. TWO MINUTES. THANK YOU, MR.
CHAIR. MEMBERS OF THE COMMITTEE.
I'M JASON LANE WITH THE
CALIFORNIA BANKERS ASSOCIATION.
APPRECIATE THE OPPORTUNITY TO
TALK ABOUT SUCH AN IMPORTANT
BILL BEFORE THE COMMITTEE TODAY.
FIRST, I'D LIKE TO THANK THE
CHAIR AND THE COMMITTEE
CONSULTANT FOR ALL THE HARD
WORK. THIS HAS BEEN A HERCULEAN
EFFORT BY BOTH SENATOR DODD, HIS
SPONSORS, AND THE COMMITTEE IN
TRYING TO PRODUCE A PROPOSAL
THAT STRIKES THE RIGHT BALANCE
OF PROTECTING SENIORS WHILE ALSO
REDUCING LIABILITY FOR
INSTITUTIONS IF THEY GET IT
WRONG. AND WE THANK THE AUTHOR
AND THE COMMITTEE FOR PRESSING
PAUSE ON THE BILL LAST YEAR AND
ALLOWING THE INDUSTRY TO GO BACK
AND HAVE DIALOGS WITH SENIOR
GROUPS AS WE FLEW SOME OF OUR
SUBJECT MATTER EXPERTS FROM THE
EAST COAST IN AND WE HAD
CONVERSATIONS ABOUT THE TYPES OF
THINGS THAT THE INDUSTRY COULD
OPERATE, OPERATIONALIZE THAT
WOULD BE MORE FOCUSED ON
PREVENTION AND PREVENTING FUNDS
FROM FLOWING OUT OF THE ACCOUNT
THAN IT DID ON LIABILITY AND
SUING BANKS, WHICH WAS THE
ORIGINAL VERSION OF THE BILL.
AND SO WE HAVE THE PRODUCT
BEFORE THE COMMITTEE, AND IT'S,
IT'S A STRONG WORK PRODUCT THAT
WILL OFFER MEANINGFUL
PROTECTIONS FOR SENIORS AND THAT
IT SETS UP A TRUSTED THIRD PARTY
CONTACT. SO IT ALLOWS A POINT OF
INTERVENTION. AND IT ALSO
REQUIRES INSTITUTIONS TO HOLD
TRANSACTIONS OF $5,000 OR MORE
IF THE INSTITUTION REASONABLY
SUSPECTS THAT THERE IS FRAUD
OCCURRING ON THE ACCOUNT, IT IS
NOT WITHOUT ITS COMPLIANCE
CHALLENGES. WE ASKED FOR A
DELAYED IMPLEMENTATION OF
JANUARY 2020. JANUARY 1ST, 2026,
BECAUSE THE INSTITUTIONS WILL
HAVE TO GO BACK AND RECONFIGURE
THEIR BACK END SYSTEMS, THEY
WILL HAVE TO RETRAIN THEIR
EMPLOYEES. AND ALL OF THIS IS
FAIRLY TAXING, PARTICULARLY ON
MY COMMUNITY, BANKS AND SMALLER
INSTITUTIONS. BUT THE BILL IS
PRECEDENT SETTING. IT WILL GO
FURTHER THAN ANY OTHER STATE IN
ITS PROTECTION OF SENIORS TO
ENSURE THAT THAT THERE'S AN
OPPORTUNITY FOR A PAUSE, IF YOU
WILL, FOR SENIORS TO REFLECT ON
ON WHETHER OR NOT THEY WANT TO
MOVE FORWARD WITH THE
TRANSACTION. UNFORTUNATELY,
THERE ARE ALSO UNINTENDED
CONSEQUENCES WITH THIS MEASURE.
CURRENTLY, THE HOLD OF
TRANSACTIONS OF $5,000 OR MORE
PROBABLY CREATES FRICTION POINTS
THAT DON'T EXIST NOW BETWEEN
SENIOR CUSTOMERS AND THEIR BANK
EMPLOYEES. THAT MEANS, IN ALL
LIKELIHOOD, YOU WILL HAVE
CONSTITUENTS WHO ARE 65 YEARS
AND OLDER WHO WILL WALK INTO A
BRANCH AND PRESENT WITH AN OUT
OF PATTERN TRANSACTION, AND IT
WILL BE DECLINED. AND, THANK YOU
VERY MUCH FOR YOUR TIME. THANK
YOU. TWO MINUTES. THANK YOU.
GOOD AFTERNOON. CHAIR MEMBERS OF
THE COMMITTEE, ROBERT WILSON,
CALIFORNIA CREDIT UNION LEAGUE.
I'D FIRST LIKE TO START BY
THANKING THE AUTHOR OF THE BILL,
THE CHAIR COMMITTEE, CONSULTANT,
EVERYONE WHO PUT IN A TON OF
WORK ON THIS. IT'S BEEN TRULY A
YEAR LONG EFFORT, AND WE REALLY
APPRECIATE IT. AS MY COLLEAGUE
WITH THE BANKERS SAID, THIS HAS
REALLY BEEN A PRODUCT OF A YEAR
LONG NEGOTIATION, AND I THINK
THERE'S A LOT TO BE PROUD OF IN
THIS BILL, THIS IS THIS BILL IS
GOING TO CAUSE SOME FRICTION
BETWEEN SENIORS AND THEIR
FINANCIAL INSTITUTIONS AND THE
COMMITTEE NEEDS TO CONSIDER HOW
MUCH OF THAT FRICTION WE REALLY
WANT THERE TO BE. WE DON'T WANT
THE MONEY FLYING OUT THE DOOR,
BUT A LOT OF THIS IS REALLY
GOING TO DEPEND ON WHAT HAPPENS
IN THE NEXT COMMITTEE IN TERMS
OF ENFORCEMENT MECHANISM, OUR
CREDIT UNIONS ARE STILL
EVALUATING THEIR POSITION ON
THIS BILL, AND A LOT OF THAT'S
GOING TO BE PREDICATED ON WHAT
WHAT HAPPENS, OVER IN THE NEXT
COMMITTEE. BUT WE THINK WHAT'S
IN FRONT OF US RIGHT NOW, WHILE
IT'S GOING TO BE A HEAVY LIFT
FOR CREDIT UNIONS, IS THE GOOD
OUTWEIGHS THE WORK THAT'S GOING
TO GO IN THERE. THIS IS GOING TO
PROTECT SENIORS. THE REPORT AND
HOLD. I'M SURE YOU GUYS WILL
PROBABLY GET SOME CALLS AT SOME
POINT ABOUT SOME, YOU KNOW,
TICKED OFF SENIORS IN YOUR
DISTRICT. BUT AT THE END OF THE
DAY, THAT'S GOING TO HOPEFULLY
THAT'S GOING TO OUTWEIGH WHAT WE
HEARD FROM FROM THE, YOU KNOW,
WITNESSES SUPPORT OF THE BILL.
AND I'M VERY SORRY ABOUT YOUR
SITUATION, SO WE CAN PREVENT
THAT JUST ONCE. THEN THEN THIS
BILL IS WORTH IT. SO WE'LL SEE
WHAT HAPPENS IN THE NEXT
COMMITTEE. I WANT TO THANK THE
AUTHOR AGAIN AND THE AND THE
COMMITTEE COMMITTEE CHAIR. AND,
THANK YOU. THANK YOU VERY MUCH
FOR YOUR TESTIMONY. ANY OTHERS
IN THE ROOM THAT ARE EITHER
NEUTRAL OR IN OPPOSITION, SIMPLY
STATE YOUR NAME, ORGANIZATION
AND POSITION. PLEASE GOOD
AFTERNOON. JOANNE BETANCOURT, ON
BEHALF OF SIFMA, THE SECURITIES
INDUSTRY, EXCUSE ME. AND
FINANCIAL INSTITUTION FINANCIAL
ASSOCIATION, WE ARE REMOVING OUR
OPPOSITION DUE TO THE NEW
AMENDMENTS. WE'D LIKE TO THANK
SENATOR DODD, THE SPONSORS AND
MR. CHAIR, FOR THEIR WILLINGNESS
TO CONSIDER OUR, OUR CONCERNS.
AND WE APPRECIATE THAT. THANK
YOU. GOOD AFTERNOON. LINDSAY
GOLDEN WITH CAPITAL ADVOCACY
HERE ON BEHALF OF THE CALIFORNIA
COMMUNITY BANKING NETWORK. WANT
TO ALIGN MY COMMENTS WITH CBA
AND THE CREDIT UNIONS? WE'RE
STILL EVALUATING OUR POSITION,
BUT REALLY DO APPRECIATE THE
WORK OF THE AUTHOR AND SPONSORS
ON THIS BILL. THANK YOU VERY
MUCH, ANY OTHERS IN OPPOSITION
OR NEUTRAL SEEING NONE. LET'S
BRING IT BACK TO THE COMMITTEE
FOR COMMENTS OR QUESTIONS. MS.
ASSEMBLYMEMBER'S. YEAH. THANK
YOU, MR. CHAIR, I JUST WANTED TO
THANK THE AUTHOR AND THEN IN
PARTICULAR, THANK THE WITNESS,
MISS ALLISON, FOR SHARING YOUR
STORY. I THINK, AS WAS
MENTIONED, YOUR STORY IS WAY TOO
COMMON IN OUR COMMUNITIES. AND
WE HEAR IT. THAT'S WHY MANY OF
US, AS LEGISLATORS TRY TO HOLD
REGULARLY SENIOR SCAM STOPPERS,
WHICH IS PART OF THE PREVENTION
MECHANISM. BUT I THINK THAT,
TODAY, I THINK THE BILL DOES
STRIKE, YOU KNOW, A BALANCE IN
TRYING TO PROTECT. AND THEN ALSO
ENSURING THAT OUR FINANCIAL
INSTITUTIONS CAN CONTINUE TO
OPERATE IN A FASHION THAT IS NOT
AS TAXING. SO I DO APPRECIATE
THE WORK AND THE STAKEHOLDERS
GETTING TOGETHER AND MAKING SURE
THAT WE CAN SEE THIS MOVE
FORWARD AND I'M HAPPY TO SUPPORT
THIS. TODAY. I'LL MAKE A MOTION.
THANK YOU. WE HAVE A MOTION FROM
ASSEMBLYMEMBER SORIA, SECOND
FROM ASSEMBLYMEMBER FONG, AND
ASSEMBLYMEMBER RUBIO. THANK YOU.
I MET WITH, SEVERAL GROUPS, AND
I REALLY DO APPRECIATE SENATOR
DODD, YOUR WILLINGNESS TO
COMPROMISE. AND I REALLY COMMEND
THE COMMITTEE, CONSULTANT AND
THE CHAIR FOR THEIR WORK. I KNEW
WHEN THEY CAME IN AND I SAID, IF
ANYBODY CAN FIX IT, IT WOULD BE
ASSEMBLYMEMBER GRAYSON. AND, OF
COURSE, THE COMMITTEE. SO I WANT
TO THANK YOU. AND THANK YOU,
SENATOR DODD, FOR BEING SO OPEN
TO, TO WORKING THROUGH THIS AND
TO THE, YOU KNOW, FORMER
OPPOSITION, YOU KNOW, THANK YOU
FOR ALSO, INTERJECTING AND
MAKING SURE THAT THIS STRIKES A
BALANCE. I KNOW IT'S NOT
COMPLETELY DONE YET, BUT I HAVE,
EVERY, HOPE THAT, SENATOR DODD
AND YOU ALL CAN COME TO AN
AGREEMENT. SO THANK YOU. AND
THANK AND THANK YOU FOR YOUR
TESTIMONY. AND I'M SO SORRY
ABOUT WHAT HAPPENED,
ASSEMBLYMEMBER DIXON. THANK YOU,
MR. CHAIR. I AND THANK YOU,
ASSEMBLYMEMBER RUBIO. I JUST
WANT TO CLARIFY WHERE WE ALL
ARE, WHERE WE'RE CLOSE, AND WE
THINK WE'RE GOING TO GET THERE
WHERE WE COULD ALL GET TOGETHER
AND SUPPORT THIS BILL. YOU THINK
THERE'S A HIGH LEVEL OF
CONFIDENCE THAT WE'LL GET THERE?
OKAY. ALL RIGHT. VERY GOOD.
THANK YOU. ASSEMBLY MEMBER FONG
AND THEN SENATOR PETRIE-NORRIS,
THANK YOU SO MUCH, CHAIR
GRAYSON. AND THANK YOU, SENATOR,
FOR BRINGING THIS VERY IMPORTANT
MEASURE FORWARD. AND THANK YOU
TO ALL THE PARTIES FOR THE WORK
AND EFFORTS ON THIS IN THE LAST
COUPLE OF YEARS. AND I JUST WANT
TO THANK MY CONSTITUENT, MISS
ALLISON. I KNOW YOU CAME TO ONE
OF OUR SENIOR SCAM STOPPER
SEMINARS TO SHARE YOUR STORY AS
WELL. IN SOUTH PASADENA, AND I'M
SORRY FOR EVERYTHING THAT'S
HAPPENED, BUT I REALLY
APPRECIATE HOW YOUR LEADERSHIP
AROUND THIS. THANK YOU. THANK
YOU, SENATOR FONG. SIMILAR
PETRIE-NORRIS YOU RECOGNIZED AS
OTHERS MEMBERS HAVE SAID, I
REALLY DO WANT TO THANK SENATOR
DODD, THE SPONSORS AND THE
INSTITUTIONS ÓRDENES FOR THE WAY
THAT YOU ALL HAVE COME TOGETHER
TO COLLABORATE AND FOR YOUR HARD
WORK ON THIS. I KNOW THAT WHEN,
YOU KNOW, ORIGINAL MEASURE WAS
BEFORE THE COMMITTEE, A NUMBER
OF US HAD CONCERNS ABOUT
UNINTENDED CONSEQUENCES AND HOW
THIS MIGHT PLAY OUT IN THE REAL
WORLD. AND YOU KNOW, YOU TOO,
MR. CHAIR, AND YOUR TEAM, I
THINK, HAVE HELPED TO FORGE A
REALLY, YOU KNOW, A RIGHT
BALANCE, BUT KIND OF A VERY
DELICATE BALANCE. AND I DID MISS
THE VERY BEGINNING OF YOUR
COMMENTS. SO APOLOGIES IF I
MISSED THIS, BUT IS THERE
SOMETHING THAT'S STILL KIND OF A
WORK IN PROGRESS? IS THAT, WELL,
THE WORK THE WORK IN PROGRESS IS
, GOING THROUGH THE JUDICIARY
AND, AND, IN TERMS OF WHAT
ENFORCEMENT MECHANISM THEY'RE
GOING TO PUT ON IT AND, YOU
KNOW, IT ESSENTIALLY IT'S YOU
KNOW, I'VE TALKED TO YOU KNOW,
BOTH SIDES ABOUT THIS AND IT'S
ELDER AND FINANCIAL ABUSE
SECTION AND, AND, THAT'S WHAT
WE'RE LOOKING TO DO. AND SO
WE'LL, WE'LL JUST HAVE TO SEE
WHAT THE JUDICIARY, JUDICIARY
COMMITTEE, YOU KNOW, HAS IN
STORE FOR THAT. OKAY. UNDERSTAND
SO IF I, IF I UNDERSTAND IF IT
DIDN'T HAVE TO GO THROUGH ONE
COMMITTEE, WE'D BE GOING BY YOUR
RIGHT NOW. PERFECT. OKAY, GOOD.
LET'S JUST LET'S CHERISH THIS
MOMENT THEN. AND YES AND YES. SO
IN ITS IN ITS CURRENT FORM, I AM
VERY HAPPY TO SUPPORT AND YOU
KNOW, CERTAINLY HOPE THAT IT
STAYS IN THAT FORM AS WE MOVE
FORWARD. ALL RIGHT. THANK YOU,
SENATOR. THANK YOU. WELL IF
ANYBODY HAS AN ACOUSTIC GUITAR,
WE COULD, BUST OUT ITS SONG
RIGHT NOW. SENATOR DODD, ANY
OTHER COMMENTS OR QUESTIONS?
SEEING NONE, SENATOR DODD, I DO
WANT TO THANK YOU FOR
INTRODUCING THE BILL. IT REALLY
DOES ADDRESS A VERY IMPORTANT
ISSUE. AND I WANT TO THANK BOTH
THE SUPPORTERS AND THE INDUSTRY
STAKEHOLDERS FOR WORKING WITH US
OVER THE LAST YEAR TO FINE TUNE
THE PROPOSAL, ONE OF THE
TAKEAWAYS FROM OUR MANY HOURS,
AND I SAY THAT, WITH MUCH
COMPASSION FOR OUR CONSULTANT
HERE, FOR THE MANY HOURS OF
DISCUSSIONS, IS THAT THE PROBLEM
IS THAT THIS PROBLEM, CAN BE
VERY COMPLICATED, NOT AN EASY
TASK TO ADDRESS. DESPITE OUR
SHARED GOAL OF PROTECTING
SENIORS FROM FINANCIAL FRAUD AND
ABUSE AND EVEN, EVEN THOUGH
THERE ARE LAWS THAT WE ALREADY
HAVE IN PLACE MEANT TO PREVENT
SUCH ABUSE, THE SITUATION
APPEARS, AT LEAST FOR RIGHT NOW,
APPEARS TO BE GETTING WORSE. SO
WITH THAT, AND FOR THESE
REASONS, I BELIEVE THAT THIS
BILL IS A START. AND IF I CAN
UNDERSCORE THAT IT'S A START OF
THE LEGISLATORS WORK TO COMBAT
ELDER FINANCIAL ABUSE. SO,
SENATOR DODD, I, I DO ENCOURAGE
YOU TO KEEP WORKING WITH
STAKEHOLDERS OVER THE NEXT FEW
MONTHS AS THE BILL MOVES FORWARD
AS NEEDED. AND WITH THAT, WOULD
YOU, AS AUTHOR, LIKE TO PROVIDE
A CLOSING STATEMENT? YES. AS YOU
KNOW, MR. CHAIR, I WAS NOT REAL
THRILLED WHEN YOU MADE THIS A
TWO YEAR BILL. I DO, BUT, YOU
KNOW, I'M I AM ONE TO ALWAYS
RECOGNIZE WHEN I'M AT FAULT AND
WHEN I'M WRONG. AND I WAS WRONG.
AND I REALLY APPRECIATE THE
WORK. AND I'VE SAID THIS,
EVERYBODY SAID THIS OF YOU AND
THE GREAT CONSULTANT HERE AND
THE WORK THAT YOU'VE DONE TO
MAKE THIS A BETTER BILL.
RESPECTFULLY ASK FOR YOUR I
VOTE. THANK YOU, SENATOR DODD.
AND WITH THAT, I BELIEVE WE CAN
MOVE FORWARD. SECRETARY, PLEASE
CALL. WE DO HAVE A MOTION A
SECOND. SO, SECRETARY, PLEASE
CALL THE ROLL ON THE BILL. SB
278. THE MOTION IS DUE. PASS AND
REFERRED TO COMMITTEE ON
JUDICIARY. GRAYSON A GRAYSON.
AYE CHEN. CERVANTES. DIXON.
DIXON. AYE MIKE. FONG. AYE.
MIKE. FONG. AYE. MAIENSCHEIN.
PETRI NORRIS. PETRIE-NORRIS.
AYE. BLANCA. RUBIO MARCO. RUBIO.
AYE. SORIA. SAU AYE. THE BILL
HAS SIX VOTES. THE BILL HAS SIX
VOTES. WE'LL HOLD IT FOR ADD ONS
FOR MORE COMMITTEE MEMBERS.
THANK YOU, MR. CHAIR, AND
MEMBERS. APPRECIATE IT. THANK
YOU SO MUCH. AND WE WILL NOW
HEAD INTO FILE ITEM NUMBER TWO,
SB 919. SENATOR UMBERG, THE
RECOMMENDATION IS DO PASS, AS
AMENDED TO THE COMMITTEE ON
JUDICIARY. THE AMENDMENTS ARE
DETAILED IN OUR COMMITTEE
ANALYSIS. SO SENATOR UMBERG,
WHEN YOU ARE READY, PLEASE,
BEGIN WITH YOUR OPENING
STATEMENT. WELL, THANK YOU, MR.
CHAIR. AND MEMBERS IN
PARTICULAR, WE WANT TO THANK YOU
AND YOUR STAFF, LUKE REIDENBACH,
FOR THEIR ASSISTANCE ON THE
BILL. WE'LL BE ACCEPTING THE
COMMITTEE'S AMENDMENTS, I WANT
TO PRESENT SB 919, WHICH
INCREASED TRANSPARENCY IN THE
FRANCHISE SALES PROCESS FOR
PROSPECTIVE, THE PROSPECTIVE
FRANCHISEE, CALIFORNIA FRANCHISE
INVESTMENT LAW CURRENTLY
REQUIRES ANNUAL REGISTRATION BY
FRANCHISE OWNERS AND DISCLOSURE
OF CERTAIN INFORMATION TO
PROSPECTIVE FRANCHISEES.
HOWEVER, THIRD PARTY FRANCHISE
SELLERS CURRENTLY ARE NOT
REQUIRED TO FILE NOTICE WITH THE
COMMISSIONER. YET THESE THIRD
PARTY FRANCHISE SELLERS OFTEN
ARE THE FIRST POINT OF CONTACT
FOR PROSPECTIVE FRANCHISE UAYS,
SO THIS ADDS TRANSPARENCY. I
WOULD ASK FOR AN AYE VOTE WITH
ME TODAY IS MR. RANDY POLLACK
WITH THE INTERNATIONAL FRANCHISE
ASSOCIATION AND KEITH MILLER
WITH THE AMERICAN ASSOCIATION OF
FRANCHISE DEALERS. THANK YOU,
SENATOR, TWO MINUTES EACH. MR.
CHAIR, MEMBERS OF THE COMMITTEE,
RANDY POLLACK, ON BEHALF OF THE
INTERNATIONAL FRANCHISE
ASSOCIATION, AND WE REPRESENT
ABOUT 10,000 FRANCHISEES AND
ABOUT A THOUSAND BRANDS. AND IT
IS ALWAYS A GOOD DAY WHEN WE CAN
BE HERE AS A COMMUNITY, WORKING
WITH THE FRANCHISEES
ASSOCIATIONS HERE IN SUPPORTING
ONE BILL. AND MAINLY THIS IS A
CONSUMER PROTECTION BILL. AS
SENATOR INDICATED, THIRD PARTY
BROKERS HAVE NO IDEA ARE THIRD
PARTY BROKERS DO NOT PROVIDE ANY
INFORMATION TO A PROSPECTIVE
FRANCHISEE. AND SO WHAT THIS
BILL DOES IS PROVIDE THAT
INFORMATION. A LITTLE BIT OF
BACKGROUND ABOUT YOUR THIRD
PARTY BROKER. WHO ARE THEY?
WHAT'S THEIR EXPERIENCE? HAVE
THEY SOLD FRANCHISES IN THE PAST
AND THE FRANCHISES THEY'VE SOLD
IN THE PAST? WHO DO THEY SELL
THEM TO SO THAT YOU HAVE THE
ABILITY TO CHECK ON THOSE
FRANCHISEES, WHETHER THEY'RE
SUCCESSFUL IN THOSE BUSINESSES,
AND WHETHER THIS IS A BUSINESS
THAT YOU WANT TO GO INTO. AND WE
BELIEVE IT'S VERY IMPORTANT,
ESPECIALLY WHEN YOU HAVE A
PROSPECTIVE FRANCHISEE WHO COULD
SPEND SOMEWHERE BETWEEN 10,000
TO SEVERAL HUNDRED THOUSAND
DOLLARS FOR A FRANCHISE. SO WE
THINK IT'S VERY IMPORTANT TO
MAKE SURE THAT THEY KNOW THAT
THEY'RE DEALING WITH SOMEBODY
WHO'S REPUTABLE, THAT SOMEONE
WHO'S REGISTERED WITH THE STATE,
AND FOR THOSE REASONS, WE ASK
FOR AN AYE VOTE. THANK YOU.
OKAY. CHAIR GRAYSON AND MEMBERS
OF THE COMMITTEE, THANK YOU. MY
NAME IS KEITH BELLER, AND I'M
HERE TODAY ON BEHALF OF THE
AMERICAN ASSOCIATION OF
FRANCHISEES AND DEALERS AND THE
COALITION OF FRANCHISEE
ASSOCIATIONS. I'VE ALSO BEEN A
SUBWAY FRANCHISEE FOR OVER 35
YEARS. FOR MANY YEARS, I'VE
SPONSORED AND PUSHED LEGISLATION
TO PROTECT FRANCHISE OWNERS AND
RARELY IN THIS CASE, BECAUSE
RANDY AND I ARE USUALLY ARGUING
ABOUT SOMETHING WHEN IT COMES TO
FRANCHISING, I NOTICED YOU PUT
THE AUTHOR BETWEEN THE TWO. I
KNOW. WELL, WE DON'T WANT TO GET
TOO CLOSE. I MEAN, IT JUST LOSES
A SPORT IN IT, ACTUALLY. BUT,
TODAY WE'RE HERE TOGETHER. AND
AS I'VE DISCUSSED OVER THE
YEARS, WHEN FRANCHISEES INVEST
IN A FRANCHISE, THEY PUT
EVERYTHING AT RISK. IF IT FAILS
DUE TO THE PERSONAL GUARANTEES
INVOLVED, THEY MAY LOSE THEIR
BUSINESS SAVINGS AND EVEN THEIR
HOUSE. THERE ARE FEDERAL AND
CALIFORNIA DISCLOSURE LAWS TO
PROTECT THE INVESTOR, TO MAKE
SURE THAT THERE IS TRANSPARENT
DISCLOSURE SO PROSPECTIVE
FRANCHISEES KNOW WHAT THEY'RE
GETTING INTO. HOWEVER, THESE
THIRD PARTY SELLERS, OFTEN
CALLED FRANCHISE BROKERS, THESE
PROTECTIONS AREN'T IN PLAY.
THESE SELLERS ARE NOT HELD TO
THE REQUIREMENTS OF EXISTING
LAW. THIS BILL WILL NOT ONLY
MAKE THEM ABIDE BY THE EXISTING
LAWS, BUT IT ALSO MAKE THEM
LIABLE IF THEY ARE NOT OFTEN
THESE THIRD PARTY SELLERS ARE
COMPARED TO REAL ESTATE AGENTS
OR BROKERS, BUT NOTHING COULD BE
FURTHER FROM THE TRUTH. THE
REALITY IS, THERE ARE ABSOLUTELY
NO REQUIREMENTS TODAY TO BECOME
A FRANCHISE BROKER. IN FACT, BY
THE TIME I FINISH THIS SENTENCE,
ALL OF YOU CAN BECOME A
FRANCHISE BROKER SIMPLY BY
CALLING YOURSELF ONE. LET'S MAKE
SURE FRANCHISEES PUTTING
EVERYTHING AT RISK HAVE
REASONABLE PROTECTIONS AND THAT
THESE THIRD PARTY SELLERS ARE
HELD TO THE STANDARDS OF
EXISTING LAWS. THANK YOU. THANK
YOU SO MUCH FOR YOUR TESTIMONY.
ANY OTHERS IN THE ROOM IN
SUPPORT? WOULD YOU LIKE TO STEP
FORWARD SEEING NONE. WE WILL GO
TO THOSE IN OPPOSITION. THÀNH NO
REGISTERED OPPOSITION. ARE THERE
THOSE IN THE ROOM SEEING NONE.
WE CAN BRING IT BACK TO THE
COMMITTEE AT THIS TIME FOR
QUESTIONS OR COMMENTS. SEEING NO
ASSEMBLY MEMBER WITH RIVETING
QUESTIONS OR COMMENTS, WE WILL
THEN TURN TO THE AUTHOR FOR
CLOSING STATEMENT. THANK YOU,
MR. CHAIR. THANK YOU, MR.
POLLACK. MR. MILLER, FOR
ATTENDING TODAY. ALTHOUGH MR.
MILLER IS A FREQUENT SUBWAY
CUSTOMER, I'M DISAPPOINTED. I
DON'T THINK THERE'S ANY FOOD
INVOLVED IN THIS, SO. ALL RIGHT,
WITH THAT, I URGE YOUR. AYE.
VOTE. THANK YOU. SO WE DO HAVE A
MOTION AND A SECOND, THE MOTION
WAS FROM SENATE OR, ASSEMBLY
MEMBER RUBIO AND SIMILAR.
PETRIE-NORRIS SECONDED,
SECRETARY, PLEASE CALL THE ROLL
ON THE BILL. SB 909, THE MOTION
IS TO PASS AS AMENDED AND
REFERRED TO COMMITTEE ON
JUDICIARY. GRAYSON. AYE.
GRAYSON. AYE. CHEN. CERVANTES
DIXON. DIXON. AYE. MIKE. FONG
MIKE. FONG. AYE. MAIENSCHEIN.
PETRIE-NORRIS PETRIE-NORRIS.
AYE. BLANCA. RUBIO. MARCO RUBIO.
AYE. SORIA. SORIA. AYE. THE BILL
HAS SIX VOTES. BILL HAS SIX
VOTES. AND WE WILL HOLD IT OPEN
FOR ABSENT MEMBERS TO ADD ON. WE
WILL NOW MOVE TO FILE ITEM
NUMBER THREE. IS SHE OKAY? FILE
ITEM NUMBER THREE SB 985.
SENATOR LOBO. YEAH. YOU ARE UP.
READY TO GO. THE RECOMMENDATION
IS DO PASS THE COMMITTEE ON
APPROPRIATIONS. US SENATOR, WHEN
YOU ARE READY, PLEASE FEEL FREE
TO BEGIN WITH YOUR OPENING
STATEMENT. THANK YOU, MR. CHAIR.
MEMBERS. SENATE BILL 985 WILL
GRANT NONPROFIT FINANCIAL
COUNSELING AGENCIES A ONE TIME
ADJUSTMENT TO THEIR FEE SCHEDULE
SO THEY CAN CONTINUE TO PROVIDE
DEBT MANAGEMENT AND SETTLEMENT
SERVICES TO CALIFORNIANS.
CURRENTLY, THERE ARE ABOUT TWO
DOZEN NONPROFIT FINANCIAL
COUNSELING AGENCIES IN
CALIFORNIA. CONSUMERS SEEKING
CREDIT COUNSELING SERVICES ARE
INVITED TO MEET WITH A FINANCIAL
COUNSELOR AT NO CHARGE, GIVEN
THAT ONLY ABOUT 20% OF CLIENTS
ENROLL IN A DEBT MANAGEMENT OR
SETTLEMENT PLAN, THE CURRENT FEE
DOES NOT ADEQUATELY COVER
EXPENSES, NOR DOES IT ALLOW FOR
THE EXPANSION OF SERVICES, AS
THE IRS REQUIRES ALL NONPROFIT
FINANCIAL COUNSELING AGENCIES TO
OBTAIN AT LEAST 50% OF THEIR
OPERATION REVENUE FROM CLIENT
FEES. THIS RULE IS INTENDED TO
ENSURE ALL NONPROFIT COUNSELING
AGENCIES REMAIN FOCUSED ON
PRODUCING THE BEST OUTCOMES
POSSIBLE FOR CONSUMERS. HOWEVER,
THIS RULE ALSO MEANS THAT
FUNDING GAPS CANNOT BE FILLED
THROUGH DONATIONS OR GRANTS.
WHILE FEE ADJUSTMENTS HAVE
OCCURRED IN OTHER STATES,
CALIFORNIA NONPROFIT AGENCY FEES
HAVE ONLY BEEN ADJUSTED ONCE
SINCE. ORIGINALLY ESTABLISHED IN
1983, MODIFYING THE CURRENT FEE
SCHEDULE WILL NOT AFFECT CLIENTS
CURRENTLY ENROLLED IN DEBT
MANAGEMENT OR SETTLEMENT PLANS.
THE ADJUSTED CAP MERELY GIVES
NONPROFIT AGENCIES THE ABILITY
TO USE A HIGHER SLIDING SCALE,
WHICH GIVES ALL CONSUMERS ACCESS
TO VALUABLE CREDIT COUNSELING
SERVICES WITH ME TO ANSWER
QUESTIONS IS JOE DEVLIN
REPRESENTING THE SPONSOR OF THE
BILL? FINANCIAL COUNSELING
ASSOCIATION OF AMERICA. THANK
YOU SO VERY MUCH. DO YOU HAVE
COMMENTS OR JUST ANSWERING
QUESTIONS? YES, I DO HAVE A JUST
A BRIEF COMMENT. TWO MINUTES.
THANK YOU SIR. GOOD AFTERNOON,
MR. CHAIRMAN. MEMBERS OF THE
COMMITTEE, MY NAME IS JOSEPH
DEVLIN. ON BEHALF OF THE
FINANCIAL COUNSELING ASSOCIATION
OF AMERICA. F.K.A IS A
COLLECTION OF SMALL NONPROFIT
ORGANIZATIONS WHO PRIVATE WHO
PROVIDE IMPORTANT FINANCIAL
LITERACY EDUCATION TOOLS AND
RESOURCES TO HELP STRUGGLING
CALIFORNIANS MANAGE CREDIT CARD
DEBT WHEN IT BECOMES TOO
BURDENSOME FOR THEM TO MANAGE
FOR THEMSELVES, MEMBERS OF THE
FINANCIAL COUNSELING ASSOCIATION
OF AMERICA PROVIDE FREE
FINANCIAL COUNSELING LITERACY,
AND WHEN APPROPRIATE, ASSISTANCE
WITH ASSISTANCE WITH DEBT
MANAGEMENT WHEN COUNSELING ALONE
IS INSUFFICIENT TO ALLEVIATE THE
CONSUMER SITUATION. THIS BILL
COMES AT AN IMPORTANT MOMENT
WHEN CONSUMER CREDIT CONSUMER
DEBT IS QUICKLY RISING. INTEREST
RATES ARE AT A NEARLY 40 YEAR
HIGH. STUDENT LOAN PAYMENTS HAVE
RESUMED, AND THE USAGE OF CREDIT
CARDS HAVE BECOME UBIQUITOUS,
WITH PAYING BILLS, GROCERIES AND
OTHER EVERYDAY TRANSACTIONS.
TOGETHER, THIS CONFLUENCE OF
EVENTS, HAVE MADE IT MORE
IMPORTANT THAN EVER THAT WORKING
FAMILIES HAVE ACCESS TO
FINANCIAL LITERACY, EDUCATION
AND THE CONSUMER CENTRIC DEBT
MANAGEMENT RESOURCES LIKE THOSE
OFFERED BY THE NONPROFIT MEMBERS
OF F.K.A. SB 985 PROVIDES AN
IMPORTANT CODE UPDATE UPDATE TO
THE CODE SECTION, WHICH HAS NOT
BEEN UPDATED IN MANY YEARS AND
WILL ENSURE THAT THESE NONPROFIT
REMAIN A FINANCIALLY VIABLE
OPTION FOR CONSUMERS HERE IN
CALIFORNIA. THANK YOU FOR YOUR
TESTIMONY. ARE THERE ANY OTHERS
IN THE ROOM IN SUPPORT? PLEASE
STEP FORWARD. SEEING NONE, I
DON'T BELIEVE WE HAVE ANY
REGISTERED OPPOSITION. SO ARE
THERE ANY, FOLKS IN THE ROOM IN
OPPOSITION? NO ONE MOVING. GOOD
FOR YOU. WE'LL BRING IT BACK TO
THE COMMITTEE MEMBERS. ANY
QUESTIONS OR COMMENTS? ASSEMBLY
MEMBER DIXON, YOU'RE RECOGNIZED.
THANK YOU. CHAIR, AND THANK YOU,
SENATOR, I'M IN SUPPORT OF THE
BILL. I JUST CURIOUS, SO EVERY
TIME THERE'S A COST OF LIVING
INCREASE, YOU'RE GOING TO HAVE
TO COME BACK FOR ANOTHER PIECE
OF LEGISLATION TO GET SUPPORT
FOR ADDITIONAL FEE INCREASE. IS
IT THERE ANY LONG TERM WAY IT
CAN BE RESOLVED INSTEAD OF
COMING BACK? NOT AT THIS TIME,
NOT WITH THIS PARTICULAR BILL.
WE WON'T, BUT WE COULD
DEFINITELY LOOK INTO THAT MOVING
FORWARD. YES. I JUST THINK FOR
NONPROFIT AGENCIES, I MEAN,
YOU'RE TRYING TO DO A GOOD THING
HERE TO PROVIDE GOOD FINANCIAL
ADVICE. AND I THINK THE I'M JUST
SURPRISED THAT THERE COULDN'T BE
A LONG TERM, LONGER TERM FIX TO
THIS. SO ANYWAY, I WOULD BE
HAPPY TO LOOK INTO THAT WITH
YOU. AND I'M SUPPORTIVE, AND I'D
LIKE TO MAKE THE MOTION TO
SUPPORT, BUT I JUST HAD A
QUESTION. THANK YOU, THANK YOU,
THANK YOU. WE DO HAVE A MOTION
TO SUPPORT ASSEMBLYMEMBER DIXON
OR MOTION AND A SECOND BY
ASSEMBLYMEMBER PETRIE-NORRIS.
ANY OTHER QUESTIONS OR COMMENTS
FROM MEMBERS SEEING NONE. WOULD
YOU LIKE TO OFFER OR OFFER A
CLOSING STATEMENT? ABSOLUTELY
RESTRUCTURING CREDIT CARD DEBT
AND LEARNING HOW TO MANAGE THAT
ARE KEY ASPECTS TO FINANCIAL
LITERACY. AMENDING THE FEE CAP
WILL ALLOW NONPROFIT AGENCIES TO
MAINTAIN AND EXPAND THEIR
SERVICES TO HELP MORE
CALIFORNIANS GAIN FINANCIAL
FREEDOM, ESPECIALLY THOSE IN
UNDERSERVED COMMUNITIES. I
RESPECTFULLY ASK FOR AN AYE
VOTE. THANK YOU SO VERY MUCH.
WITH THAT, WE DO HAVE A MOTION
AND A SECOND SECRETARY. PLEASE
CALL THE ROLL ON THE BILL SB
985. THE MOTION IS DUE PASSED
AND REFERRED TO COMMITTEE ON
APPROPRIATIONS. GRAYSON I
GRAYSON I CHEN CERVANTES I
CERVANTES I DIXON. DIXON I MIKE
FONG. HI. MIKE FONG I
MAIENSCHEIN PETRIE-NORRIS.
PETRIE-NORRIS I BLANCA RUBIO.
BLANCA RUBIO I SORIA I SORIA I.
THAT BILL HAS SEVEN VOTES. BILL
HAS SEVEN VOTES. WE'LL KEEP IT
OPEN FOR ABSENT MEMBERS. THANK
YOU. THANK YOU SO VERY MUCH.
NEXT UP ON THE DOCKET FILE, ITEM
NUMBER FOUR, SB 1146, SENATOR
WILK, RECOMMENDATION IS DO PASS
TO THE COMMITTEE ON JUDICIARY.
SO, SENATOR WILK, WHEN YOU ARE
READY, PLEASE FEEL FREE TO OPEN
UP. THANK YOU. MR. THANK YOU,
MR. CHAIR AND MEMBERS. SB 1146
IS A CLEANUP MEASURE ADDRESSING
CALIFORNIA'S MORTGAGE, EXCUSE
ME, FORECLOSURE AND MORTGAGE
LAWS. MY NEW STAFFER WHO'S
SITTING HERE WROTE ME A THREE
PAGE SCRIPT, BUT I THINK WHAT
WOULD BE MORE, BENEFICIAL TO YOU
IS TURN IT OVER TO MIKE BELOW TO
EXPLAIN USURY LAW AND WHY THIS
IS NEEDED. SO WITH THAT, I WOULD
WHOLEHEARTEDLY AGREE. MR. CHAIR
AND MEMBERS, MIKE BULLARD, ON
BEHALF OF THE CALIFORNIA
MORTGAGE ASSOCIATION AND UNITED
TRUSTEES ASSOCIATION. THE BILL
IS VERY TECHNICAL AND I
APPRECIATE THE GOOD ANALYSIS.
THE MOST RECENT AMENDMENTS DEAL
WITH USURY AND USURY. CAN BE A
SENSITIVE SUBJECT, AND IT'S A
TECHNICAL ONE. BUT WE THINK THE
CHANGES IN THE IN THE LAW HERE
ARE VERY, VERY TECHNICAL. FIRST,
I REPRESENT REAL ESTATE BROKERS
WHO ARE ATTEMPTING USUALLY TO
KEEP PEOPLE OUT OF FORECLOSURE
BY MODIFYING, EXTENDING A LOAN,
AND THOSE PHRASES ARE USED
SOMETIMES IN THE STATUTE, BUT
NOT UNIFORMLY. AND IN A RECENT
CASE, THE COURT, A BANKRUPTCY
COURT, HELD THAT THE USURY
EXEMPTION DIDN'T APPLY BECAUSE
IT WAS STYLED AS A MODIFICATION
RATHER THAN AN EXTENSION. THOSE
THINGS ARE ESSENTIALLY
SYNONYMOUS. BUT IF YOU IF YOU
DON'T THINK A ONE WORD MATTERS
IN A STATUTE, WHAT THE CURRENT
LAW ALSO SAYS IS IF A REAL
ESTATE BROKER DID THE FIRST
TRANSACTION AND THE BROKER DOES
THE SECOND TRANSACTION TO AVOID
FORECLOSURE, THE COURT SAID IT
MUST BE BECAUSE THE WORD IS THE
IT MUST BE THE SAME BROKER.
WELL, THE SAME BROKER MAY BE OUT
OF STATE OR RETIRED OR DECEASED
AND OBVIOUSLY CAN'T DO THE
SECOND TRANSACTION. SO WE CHANGE
IT FROM THE TO A, BECAUSE YOU
WANT A REAL ESTATE BROKER
INVOLVED IN IT. AND SO WE THINK
THIS SOLVES PROBLEMS. A ONE WORD
CHANGE MAKES A BIG DIFFERENCE,
WE DON'T THINK IT'S
CONTROVERSIAL. IT'LL HELP US
KEEP PEOPLE OUT OF FORECLOSURE.
AND WE WOULD ASK FOR AN AYE
VOTE. THANK YOU SO MUCH FOR YOUR
TESTIMONY. WE HAVE A MOTION BY
ASSEMBLYMEMBER PETRIE-NORRIS,
SECOND BY ASSEMBLYMEMBER SORIA.
ANY OTHERS IN THE ROOM IN
SUPPORT, PLEASE STEP FORWARD.
STATE YOUR NAME, ORGANIZATION
AND POSITION CHAIR AND MEMBERS.
VANESSA CHÁVEZ, ON BEHALF OF THE
CALIFORNIA ASSOCIATION OF
REALTORS AND SUPPORT. THANK YOU.
THANK YOU SO VERY MUCH. ANY
OTHERS SEEING? NONE, WE WILL GO
TO OPPOSITION. NO REGISTERED
OPPOSITION ANY IN THE ROOM. IN
OPPOSITION. SEEING NONE. WE WILL
BRING IT TO COMMITTEE FOR
COMMENTS, QUESTIONS FROM
COMMITTEE MEMBERS, SEEING NONE.
WOULD YOU LIKE TO OFFER A
CLOSING STATEMENT? AND THAT'S
WHY I DID NOT READ MY THREE PAGE
STATEMENT. YOU STATE THAT I
RESPECTFULLY ASKED FOR AN AYE
VOTE. THANK YOU ARTHUR, YOU HAD
US ALL NERVOUS THERE. JUST FOR A
SECOND, WE DO HAVE A MOTION. A
SECOND SECRETARY, PLEASE CALL
THE ROLL ON THE BILL. SB 1146.
THE MOTION IS DUE PASSED AND
REFERRED TO COMMITTEE ON
JUDICIARY. GRAYSON A GRAYSON.
AYE. CHEN. CERVANTES CERVANTES.
AYE. DIXON. DIXON. AYE. MIKE.
FONG HI. MIKE. FONG. AYE.
MAIENSCHEIN. PETRIE-NORRIS
PETRIE-NORRIS. AYE. BLANCA.
RUBIO. BLANCA. RUBIO AYE. SORIA.
SORIA. AYE. THE BILL HAS SEVEN
VOTES. BILL HAS SEVEN VOTES.
WE'LL HOLD IT OPEN FOR ABSENT
MEMBERS. THANK YOU, MR. CHAIR
AND MEMBERS. MUCH WHILE WE'RE
WAITING FOR THE NEXT AUTHOR TO
ARRIVE. AND CAN WE GO BACK AND
GET A MOTION FOR THE CONSENT
CALENDAR? SO WE HAVE A MOTION BY
ASSEMBLYMEMBER RUBIO, SECOND BY
ASSEMBLYMEMBER CERVANTES.
SECRETARY, PLEASE CALL THE ROLL
ON THE CONSENT CALENDAR. SB
1521. THE MOTION IS TO PASS AND
REFER TO COMMITTEE ON
APPROPRIATIONS. GRAYSON A
GRAYSON. AYE. CHEN CERVANTES.
CERVANTES. AYE. DIXON DIXON.
AYE. MIKE. FONG. MIKE. FONG.
AYE. MACHINE PETRIE-NORRIS. AYE
AYE. PETRIE-NORRIS. AYE. BLANCA.
RUBIO. BLANCA RUBIO. AYE. SORIA.
SORIA AYE. THAT HAS SEVEN VOTES.
SEVEN VOTES ON THE CONSENT
CALENDAR. WE'LL HOLD IT OPEN FOR
ABSENT MEMBERS. SENATOR ROTH,
ITEM FILE ITEM NUMBER FIVE, SB
1198 RECOMMENDATION IS Dð. PASS
TO COMMITTEE ON APPROPRIATIONS.
WHEN YOU'RE READY, PLEASE FEEL
FREE TO OPEN UP. THANK YOU, MR.
CHAIR. AND MEMBERS, THE BILL
THIS BILL ENSURES THE FINANCIAL
VIABILITY OF THE INDUSTRY BY
INCREASING HANDLING AND STORAGE
FEES TO ACCOUNT FOR INCREASED
SECURITY COSTS, ALLOWING FOR A
NEW REMOTE TRANSACTION FEE, AND
ALSO INCREASING THE FEE TO
PREPARE THE LOAN EXPIRATION
NOTICE. AS YOU MAY KNOW, ALL OF
YOU, EVERY FIVE YEARS THE
PAWNBROKERS COME BEFORE THE
LEGISLATURE TO REQUEST APPROVAL,
AS THEY MUST TO ADJUST MAXIMUM
FEES THAT CAN BE CHARGED ON A
LOAN TRANSACTION. THÀNH. TO KEEP
PACE WITH RISING OPERATIONAL
COSTS. WE'RE NOW AT THAT FIVE
YEAR MARK, WHICH IS WHY WE'RE
BACK. PAWNSHOPS THROUGHOUT THE
STATE SERVE AS A RELIABLE SOURCE
OF SHORT TERM LOANS, ALLOWING
SOMEONE TO ACCESS ACCESS MUCH
NEEDED CASH WITHOUT THE HASSLE
OFTEN ASSOCIATED WITH
TRADITIONAL LENDING
INSTITUTIONS. ASSUMING THEY CAN
GET TRADITIONAL LENDING
INSTITUTIONS TO LEND THEM MONEY.
WHETHER IT'S COVERING MEDICAL
BILLS, CAR REPAIRS OR OTHER
URGENT EXPENSES, PAWNSHOPS OFFER
AN INSTANT AND ACCESSIBLE
SOLUTION FOR THOSE IN NEED,
OFTENTIMES IN OUR DISADVANTAGED
COMMUNITIES. CURRENT LAW LIMITS
THE AMOUNT OF COMPENSATION THAT
PAWNBROKERS MAY CHARGE OR
RECEIVE FOR PROVIDING THEIR
SERVICES, AND WITHOUT THESE FEE
INCREASES, AS THESE LENDING
BUSINESSES MAY CONTINUE TO CLOSE
THROUGHOUT THE STATE, HAVING AN
IMMEDIATE AND DRAMATIC IMPACT ON
OUR LOW INCOME COMMUNITIES, THE
COMMUNITIES THAT THEY SERVE, AT
THE APPROPRIATE POINT IN TIME.
OUR REQUEST RESPECTFULLY ASK FOR
YOUR AYE VOTE. BUT BEFORE THAT,
HERE WITH ME TODAY TO TESTIFY IN
SUPPORT OF THE BILL, FORMER
ASSEMBLY MEMBER ALBERTO TORRICO
ON BEHALF OF THE CALIFORNIA
PAWNBROKERS ASSOCIATION, THANK
YOU. SENATOR, PLEASE. THANK YOU,
MR. CHAIRMAN. SENATOR ROTH,
FIRST OF ALL, LET ME THANK THE
CHAIR AND THE CONSULTANT ON THE
COMMITTEE FOR THE ANALYSIS AND
YOUR HELP ON THE BILL. I JUST
WANT TO HIGHLIGHT A COUPLE OF
THINGS THAT WERE IN THE ANALYSIS
AND ALSO MENTIONED BY SENATOR
ROTH, FIRST AND FOREMOST, THE
CUSTOMERS OF THE PAWNBROKERS ARE
ALMOST ALL UNBANKED. THEY DON'T
HAVE ACCESS TO ANY OTHER FORM OF
CREDIT. AND THESE ALMOST ALWAYS
AS WELL ARE BRIDGE LOANS IN CASE
OF EMERGENCY. THE SECOND THING
IS THAT, ONE OF THE SIGNIFICANT
COST DRIVERS FOR THE PAWNBROKERS
OVER THE LAST FIVE YEARS, IN
PARTICULAR, ARE MIRRORED IN
TRADITIONAL RETAIL SHOPS. THEY
ALSO ARE ARE VICTIMS OF RETAIL
THEFT IN LARGE NUMBERS. AND THEY
AND BECAUSE THEY ARE REQUIRED TO
KEEP THE COLLATERAL IN A SAFE
PLACE, THEY HAVE TO HAVE
DIFFERENT, MORE EXTENSIVE
MEASURES OF SECURITY. SO THEY
HAVE IF YOU SEE THESE PAWNSHOPS
AT NIGHT, THEY HAVE THEY HAVE
IRON GATES, THEY HAVE TO HAVE
BANK LEVEL SAFES IN THE BACK TO
KEEP, TO STORE THE VERY VALUABLE
GOODS. AND THEY ALSO HAVE TO
HAVE SECURITY GUARDS. SO THESE
ARE EXPENSES THAT ARE NEW OVER
THE LAST FIVE YEARS. AND WE
THINK THE BILL STARTS TO ACCOUNT
FOR THOSE TO MAKE SURE THAT
THESE SHOPS CAN STAY IN
BUSINESS. THANK YOU VERY MUCH.
THANK YOU SO MUCH FOR YOUR
TESTIMONY. AND WE WILL ASK FOR
ANY OTHERS IN SUPPORT IN THE
ROOM. PLEASE COME FORWARD.
SEEING NONE, NO REGISTERED
OPPOSITION. BUT WE WILL ASK IF
THERE ARE ANY IN THE ROOM.
OPPOSED. STEP FORWARD. SEEING
NONE. WE'LL BRING IT TO
COMMITTEE FOR COMMENTS OR
QUESTIONS AND WE HAVE A MOTION.
ASSEMBLYMEMBER'S PETRIE-NORRIS
SECOND BY ASSEMBLYMEMBER RUBIO,
WOULD YOU LIKE TO MAKE A CLOSING
STATEMENT, RESPECTFULLY, ESTÁ
AND I VOTE AND THANK YOU FOR
YOUR CONSIDERATION. THANK YOU SO
VERY MUCH, SENATOR. AND WITH
THAT SECRETARY, PLEASE CALL THE
ROLL ON THE BILL, SB 1198. THE
MOTION IS TO PASS AND REFERRED
TO COMMITTEE ON APPROPRIATIONS.
GRAYSON. I RECENT I CHEN
CERVANTES I CERVANTES I DIXON.
DIXON I MIKE FONG MIKE FONG I
MAIENSCHEIN PETRIE-NORRIS HI
PETRIE-NORRIS I BLANCA RUBIO.
BLANCA RUBIO I SORIA SORIA I.
THAT BILL HAS SEVEN VOTES. BILL
HAS SEVEN VOTES. THANK YOU, MR.
CHAIR AND MEMBERS. THANK YOU FOR
YOUR CONSIDERATION. THANK YOU SO
VERY MUCH. WE'LL KEEP THE ROLL
OPEN FOR ABSENT MEMBERS,
SECRETARY, CAN WE START FROM THE
VERY BEGINNING AND JUST GO
THROUGH EACH ONE AND LET ADD ONS
, SB 278, THE MOTION IS TO PASS
AND REFER TO COMMITTEE ON
JUDICIARY CHEN CERVANTES.
CERVANTES. I MAIENSCHEIN. THE
BILL HAS SEVEN VOTES.
SB 919. THE MOTION IS TO PASS,
AS AMENDED AND REFERRED TO
COMMITTEE ON JUDICIARY CHEN
CERVANTES AS CERVANTES. I
MAINTAIN THE BILL HAS SEVEN
VOTES.
WE'LL CONTINUE TO HOLD THE ROLL
OPEN FOR ABSENT FOR AN ABSENT
MEMBER. AND, THE REST OF YOU,
HAVE A GREAT DAY. YEAH, WE'LL
WAIT FOR, WE'LL KEEP IT OPEN NO
LONGER THAN TEN MINUTES. THANK
YOU VERY MUCH. YEAH. THANK YOU.
JUST SUBBING FOR LIZ. IT WORKED
OUT GREAT. THANK YOU. THANK YOU
SIR. YEAH.
OKAY. MISTER CHAIR. ABSOLUTELY.
WE ARE GOING TO GO THROUGH EACH
ITEM, STARTING SECRETARY,
STARTING RIGHT AT THE BEGINNING,
PLEASE. SB 278, THE MOTION IS DO
PASS AND REFER TO THE COMMITTEE
ON JUDICIARY CHEN MAIENSCHEIN
MAIENSCHEIN I. THE BILL HAS
EIGHT VOTES. THE BILL GETS OUT
WITH EIGHT VOTES. SB 919, THE
MOTION IS DO PASS AS AMENDED AND
REFERRED TO COMMITTEE ON
JUDICIARY. CHEN MAIENSCHEIN
MAIENSCHEIN I. THE BILL HAS
EIGHT VOTES. THE BILL HAS EIGHT
VOTES. PASSES AND IS OUT OF
COMMITTEE. SB 985. THE MOTION IS
DUE PASS AND REFERRED TO
COMMITTEE ON APPROPRIATIONS.
CHEN MAIENSCHEIN MAIN HÌNH I
THAT HAS EIGHT VOTES, EIGHT
VOTES. IT PASSES AND IS OUT OF
COMMITTEE. SB 1146 CHEN
MAIENSCHEIN MAIENSCHEIN I. THAT
BILL HAS EIGHT VOTES. I'M SORRY.
THE MOTION TO DO PASS AND REFER
TO COMMITTEE ON JUDICIARY. THANK
YOU FOR THAT, SECRETARY. THE
BILL HAS EIGHT VOTES AND PASSES.
IT IS OUT OF COMMITTEE. SB 1198.
THE MOTION IS TO PASS AND REFER
TO COMMITTEE ON APPROPRIATIONS.
CHEN MAIENSCHEIN MAIENSCHEIN I.
THE BILL HAS EIGHT VOTES. BILL
HAS EIGHT VOTES. IT PASSES AND
IS OUT OF COMMITTEE ON THE
CONSENT CALENDAR. SB 1521. THE
MOTION IS TO PASS AND REFER TO
COMMITTEE ON APPROPRIATIONS.
CHEN MAIENSCHEIN MAIENSCHEIN I
THAT HAS EIGHT VOTES. CONSENT
CALENDAR HAS EIGHT VOTES AND THE
BILL'S AND HAS BEEN ADOPTED.
THANK YOU VERY MUCH. WE HAVE
COMPLETED OUR AGENDA FOR TODAY'S
HEARING. WE WILL, NOW MOVE TO
CLOSE THE HEARING. THANK YOU
VERY MUCH. THE COMMITTEE HEARING
IS ADJOURNED.