Welcome to the July 6-10 edition of the Main Street Minute from your small-business-advocacy team in Sacramento.<\/p>\n
Please Act on Your Action Alert<\/p>\n
A bad piece of legislation is working its way through the State Senate, and NFIB is calling on its members to urge their senators to vote NO on it.<\/p>\n
Assembly Bill 2646<\/a> would increase the minimum wage for agricultural employees to $19.75 per hour.<\/p>\n Californians rejected an $18 minimum wage in 2024\u00a0because it would have been devastating to all residents.<\/p>\n Increasing the minimum wage to $19.75 per hour will lead to the closure of small businesses, widespread job loss and job automation, income reductions, and price increases for all Californians. At the push of a button, NFIB makes it easy to\u00a0tell your\u00a0senator you cannot afford a $19.75 minimum wage and Assembly Bill 2646.\u00a0Take action here<\/a>.<\/p>\n The Legislature<\/p>\n Lawmakers started their summer recess last Thursday, July 2, and will be gone for a month, returning for business on Monday, August 3.<\/p>\n They will have less than a month to finish their business before the scheduled August 31 adjournment date for the 2025-2026 session.<\/p>\n Among the priorities for NFIB will be defeating Assembly Bill 2646 (see section above), Assembly Bill 2021, creating a paid informant system for alleged violations of workplace regulations, and Assembly Bill 1421, exploring establishing a mileage-based fuel charge.<\/p>\n Another bill NFIB is vigorously opposing is Assembly Bill 649<\/a>, which originally started out with the well-meaning intent of establishing a small business right-to-cure period but was subsequently amended to \u201ccreate too much risk and uncertainty for California\u2019s smallest businesses and potentially create more challenges and liability for them under the ADA, Unruh Civil Rights Act, and the Unfair Competition Law,\u201d according to NFIB and its coalition partners\u2019 letter of opposition.<\/a><\/p>\n On the other side of the ledger, NFIB will push for passage of Senate Bill 690,<\/a> dealing with the processing of personal information. A letter of support from a coalition NFIB is part of can be read here.<\/a><\/p>\n November Ballot Initiatives Assigned Numbers<\/p>\n Last Monday (June 29), Secretary of State Shirley Weber assignment numbers for the 14 initiatives<\/a> that will appear on this November\u2019s General Election ballot.<\/p>\n \u201cThe\u00a014 measures that will appear on the Nov. 3 ballot\u00a0were going to be as many as 20 before last-minute compromises settled three dueling measure conflicts,\u201d reports veteran Capitol observer Dan Walters in CalMaters.<\/a> \u201cOne pitted personal injury lawyers against rideshare companies, a second involved hospital executives and a health care union, and the third\u00a0dealt with vote minimums for local taxes.<\/p>\n \u201c\u2026 However, the most prominent ballot measure conflict \u2014 over whether California should impose a 5% wealth tax on billionaires \u2014\u00a0defied resolution<\/a>. The measure, sponsored by the SEIU healthcare workers union, will be\u00a0Proposition 40<\/a>\u00a0and will compete with two countermeasures sponsored by billionaire Sergey Brin and other Prop. 40 foes,\u00a0Proposition 41<\/a>\u00a0and\u00a0Proposition 42<\/a>.<\/p>\n \u201cThey could, if passed with higher vote counts, kneecap the wealth tax.\u201d<\/p>\n New State Budget Now in Effect<\/p>\n State lawmakers met their constitutional obligation to pass a state budget for the 2026-2027 Fiscal Year by June 15, but two weeks remained for them to fine tune it by July 1.<\/p>\n Last Monday (June 29), the fine tuning ended in a $351.7 billion spending plan that didn\u2019t sound so sweet to the ears of small business owners. As reported<\/a> by The Sacramento Bee, \u201cThe budget also raises a tax on commercial health plans, part of a suite of revenue-raising measures lawmakers and the governor agreed upon to balance the budget. Opponents of the health insurance tax increase, including the companies that administer those commercial plans, estimate it could increase the cost of families\u2019 monthly insurance premiums by around $400 a year.\u201d<\/p>\n Are big troubles around the corner?<\/p>\n \u201cThe nonpartisan Legislative Analyst\u2019s Office has warned lawmakers that California is increasingly vulnerable to the next economic downturn as its commitments to social programs balloon,\u201d reported CalMatters\u2019 Lynn La.<\/a> \u201cIn May, the office said California\u2019s revenue outlook \u2018rests disproportionately on AI-driven equity valuations<\/a>\u2019 and that the state is \u2018ill-prepared for even a slip up in revenues,\u2019 given its spending, diminished reserves and debt.<\/p>\n \u201cTranslation? Because so much of California\u2019s revenues come from the top 1% of income earners, a dip in the stock market could mean massive drops in available state funding for all its increased fiscal promises.\u201d<\/p>\n Health Insurance Premiums to Rise \u201cNew federal rules are forcing the state to restructure its managed care organization tax, or MCO tax, which the state collects from health insurance plans that coordinate care for their members. California has been charging Medi-Cal insurance plans at a higher rate than private plans. The state\u2019s newly designed solution,\u00a0Senate Bill 125,<\/a>\u00a0will lower the tax on Medi-Cal plans and raise the tax on private plans to the same level. If finalized by the governor, and accepted by the federal government, the new plan would shift more of the cost burden onto people who buy private insurance but bring in less revenue overall,\u201d reports CalMatters.<\/a><\/p>\n \u201cThe Department of Finance said it tried to balance affordability for privately insured patients with generating enough revenue to keep the safety net afloat amid federal funding cuts. The department settled on the $8.85-a-month assessment because that rate would generate $2.3 billion a year \u2014 roughly the amount that the state generated before 2023 to support Medi-Cal, said H.D. Palmer, a spokesperson for the Department of Finance.\u201d<\/p>\n NFIB is opposed to increasing the MCO tax.<\/p>\n Speaking of the Feds <\/p>\n \u201cThe National Oceanic and Atmospheric Administration announced it will perform a thorough\u00a0evaluation<\/a>\u00a0of the state\u2019s coastal management practices, including how watchdogs have addressed \u2014 \u2018or failed to address \u2026 spaceport infrastructure, offshore oil production, pipeline maintenance, desalination projects, undersea cables, and other key priorities of national importance.\u2019<\/p>\n \u201c\u2019Obstructionist policies that delay critical national infrastructure in the name of environmental extremism are unacceptable,\u2019\u201d said U.S. Commerce Secretary Howard Lutnick in this, slightly slanted, story<\/a> from KQED in San Francisco.<\/p>\n \u201cNOAA will hold an in-person meeting and two virtual public hearings on the topic in August and will accept comments through Aug. 22.\u201d<\/p>\n NFIB members are past masters at dealing with regulatory agencies, state and federal, and the views they have are not the most commendatory. But hope remains alive. When asked on this year\u2019s state member ballot, \u2018Should California further reform the California Environmental Quality Act (CEQA) to make it easier to rebuild residential properties, particularly in communities recovering from natural disasters?\u2019, a resounding 92% said \u2018Yes.\u2019 Fat chance of that happening. But with a little federal prodding, who knows?<\/p>\n Not All News from San Francisco is About AI Innovation<\/p>\n \u201cFounder of Real SF Startup Is Cutting Up Banned Target Bags and Calling Them Dog Raincoats. They\u2019re $2,\u201d<\/a> reports Hoodline.<\/p>\n \u201cSan Francisco has always had a knack for turning its own municipal neuroses into folk art, and a recent\u00a0Facebook Marketplace listing<\/a>\u00a0from a local seller named Chris Fayemi may be the city\u2019s most inspired, possibly joke, product launch in recent memory: custom dog raincoats, made to order, crafted entirely from repurposed plastic shopping bags. The post has accumulated over 200 likes and counting, which, for a Facebook Marketplace listing, is basically going viral.\u201d<\/p>\n Calendar<\/p>\n \u2014 July 2-August 3: Legislature on Summer Recess<\/p>\n \u2014 August 31: Legislature adjourns its 2026 session<\/p>\n \u2014 September 30: Last day for governor to sign or veto bills sent to him.<\/p>\n \u2014 November 3: Election Day<\/p>\n National<\/p>\n Highlights from Federal Government Relations Principal Louis Bertolotti\u2019s weekly report<\/p>\n \u2014 NFIB sent a press release<\/a> expressing disappointment in the missed opportunity to exempt American small businesses from the BOI reporting mandate through an amendment to the National Defense Authorization Act.<\/p>\n \u2014 Reuters, CNBC, MSN, and others quoted SBLC Vice President & Executive Director Beth Milito from her testimony<\/a> in opposition to proposed tax increases to fix anticipated Social Security fund deficits: \u201cThe bill is \u2018not simply a tax increase on wealthy individuals but on the revenue a small business owner needs to operate, grow, and expand.\u201d<\/p>\n \u2014 250 years later, it\u2019s easy to forget that many of our founding fathers were essentially small business owners. Benjamin Franklin ran a successful printing press. George Washington operated a large commercial gristmill at Mount Vernon. John Hancock was a prominent merchant. Thomas Jefferson managed extensive agricultural operations. It\u2019s likely that many would have been NFIB members themselves, if we were around back then!<\/p>\n
A $19.75 minimum wage\u00a0that increases annually\u00a0will only make California more unaffordable.<\/p>\n
\u2026 If the Feds Agree<\/p>\n