Special session ends. Another $1.50 a gallon for gas? NFIB debates Prop. 32 backer on radio for the fourth time
Welcome to the October 21-25 edition of the NFIB California Main Street Minute from your small-business advocacy team in Sacramento.
Keeping Up the ‘No on 32’ Drumbeat
- NFIB California State Director John Kabateck once again debated Proposition 32’s biggest proponent, Joe Sanberg, last Tuesday (October 15), this time on Berkeley-based KPFA radio. Click here to listen to the exchange, which starts at the 33:44-minute mark.
- This was the fourth time the duo have crossed swords over the minimum wage issue, the first time was September 8 on NBC4 in Los Angeles with reporter Conan Nolan, the second time an October 1 debate on NPR-affiliate KQED in San Francisco, and the third time on October 10 on the AirTalk Show with Larry Mantle on LAist Radio, 93.3 FM in Pasadena.
Special Session Ends
- Because it sounds too close to comedy, the word comity (courteous and considerate behavior toward others) seldom gets used and was nowhere to be found last Monday (October 14) when the Assembly met just long enough to pass Assembly Bill X2-1, Gov. Gavin Newsom’s baby, which he lovingly signed the same day.
- “The measure aims to smooth out seasonal surges in prices at the pump by increasing state oversight of refinery maintenance,” reported CalMatters. “This could include requiring operators to maintain a minimum fuel reserve that they can dip into when they go offline.
— “The governor pushed for a version of this bill at the end of the legislative session in August but was rebuffed by lawmakers frustrated that they had no time to vet it. So Newsom called a special session, bringing the occasionally reticent Legislature back to Sacramento in the middle of an election campaign to pass his proposal, despite political jitters and the vocal opposition of organized labor.
— “But during Monday’s signing ceremony, Newsom reserved his fire for oil companies … ‘They’re screwing you. They’ve been screwing you for years and years and years. There’s no other way to put it.’
— “ … The Western States Petroleum Association, which represents the oil industry in California, slammed Newsom for ‘a political performance’ that ‘chose to demonize an industry that powers California’s economy and fuels the daily lives of millions.’ President and CEO Catherine Reheis-Boyd, in a statement: ‘The Governor’s attacks, filled with personal insults toward the press and the industry, only serve to divide, not address the urgent issues we face.’
— “The ceremony followed a succinct floor session in which the Assembly gave final approval to the bill so quickly and unceremoniously that reporters in the back of the chambers didn’t even realize the vote had happened at first.”
- Is it all for naught?
- In an October 15 guest column in The Orange County Register, public policy expert Matt Quan contends, “Newsom’s gas storage law physically won’t work. The closest comparison is the U.S. Strategic Petroleum Reserve. The petroleum reserve holds up to 714 million barrels of crude oil, a 90-day supply of imports, in salt caverns in Texas and Louisiana. It is politically popular.
— “However, refined products such as gas and diesel cannot be stored underground. Most of California’s refineries are located in built-up urban areas along the coast in Contra Costa and Los Angeles counties. Increased storage will be either impossible or parts of the Central Valley and Inland Empire will have to be dedicated to fuel storage.
— “Refineries are unlikely to make capital investments in this hostile regulatory environment, and the state won’t pay for its storage mandate either. Therefore refineries will likely reduce production to meet required inventory. With lower supply, and the same demand, fuel prices increase.
— “This will impact transportation costs. Consequently, food prices will increase and all economic activity will decrease. In the current economy, Californians will prioritize driving to work at the expense of everything else, hurting the middle class and small businesses.”
- Adios.
- Reports Politico, “THAT WAS QUICK: Part of California’s problem with gas prices is it only has nine oil refineries to serve 31 million gas-slurping vehicles. Soon it’ll be eight.
— “Phillips 66 this afternoon [October 16] cited ‘long-term uncertainty’ in announcing that it’s shutting down California’s seventh-largest refinery next year.
— “The news comes just two days after Gov. Gavin Newsom signed a major new law, roundly opposed by the oil industry, that tries to get a handle on gas price spikes. It does so by giving the California Energy Commission new authority to require refiners to store more gas and make other preparations to guard against supply shortages.
— “… the oil industry has been warning for a while now that Newsom’s aggressive regulatory push (don’t forget about the refinery profit cap his administration is also considering) could drive refiners out of the state. Chevron bigwig Andy Walz warned us again in an interview last week, saying it’s getting harder to convince his bosses to invest in California rather than its other refineries around the world.”
- As pointed out in last week’s Main Street Minute, energy prices are no small matter to small businesses, which listed them as their sixth biggest worry in NFIB’s latest Small Business Problems & Priorities report, a 13-place jump from their 2020 ranking of 19th. The report ranks a total of 75 issues.
- NFIB California sent this new release commenting on the signing of ABX2-1.
Another $1.50 a Gallon?
- “California motorists are already paying $1.50 more per gallon for gasoline than the national average price of the other 47 continental states,” began a letter to California Air Resources Board Chair Liane Randolph, sent last Tuesday, October 15, and signed by more than two dozen Republican senators and assemblymembers.
- “It is with this in mind that we write you again with serious concerns about the proposed amendments to the Low-Carbon Fuels Standard (LCFS) program that will drive up fuel prices. We regret that the California Air Resources Board (CARB) refuses to release any analysis of how its proposed LCFS amendments will affect gas prices in California.
- “Without specific information from CARB, it is reasonable to assume that its adoption of these amended regulations will directly increase gas prices by up to $0.65 in the near term, up to $0.85 per gallon by 2030, and up to $1.50 per gallon by 2035 …”
- The letter also called on an unusual ally to make its point, quoting from Los Angeles Times capitol reporter George Skelton’s October 12 column.
- “… A year ago the air board (CARB) estimated that the new regulation could raise gas prices by 47 cents a gallon because of refinery costs passed on the consumers. A separate study placed the pump cost much higher – 65 cents a gallon. Now the air board has backed off its 47-cent price hike estimate. And it refuses to offer a revised forecast . . . So an unelected bunch of regulators can arbitrarily adopt new rules without weighing the costs to consumers? Doesn’t seem right. Seems a bit irresponsible and arrogant.”
- Not included in the legislators’ letter were Skelton’s opening paragraphs:
- “The Newsom administration is in conflict with itself on gasoline pricing, speaking from both sides of its mouth. Is it trying to hold down prices at the gas pump or is it OK with hiking them? Both, it seems. And it smacks of hypocrisy.”
- The remaining CARB Board meeting for the year are:
— October 23-24
— November 6
— November 20-21
— December 11-12
- NFIB will be monitoring each closely. Click here for the CARB link with information on meeting agendas, connecting to their webcast, and the link to make public comment.
Yes on Proposition 36 Rally
- NFIB members in the Sacramento area are invited to attend a Yes on Prop. 36 rally this Wednesday, October 23, beginning at 10:30 a.m. at 1601 W. Capitol Ave. in West Sacramento. NFIB has endorsed passage of Prop. 36.
Election Day Reminder
- If you haven’t voted by mail already, check out, NFIB California 2024 Small Business Election Central, for the list of legislative candidates and ballot measures endorsed by the NFIB CA PAC.
- Also, the NFIB California in the News 2024 story has been updated with the latest samples of media hits. It’s been a busy year for State Director John Kabateck, who has been quoted in 25 media stories about the minimum wage, 19 of them on Proposition 32, and there’s still a couple of weeks left before Election Day.
- Other topics the media were interested in were NFIB’s opinion on retail theft, plastic shopping bags, paid sick leave, results from NFIB’s member ballot, and the latest Optimism Index findings.
Calendar
- Today, October 21, is the last day to register to vote
- November 5, General Election Day
- November 30, National Shop Small Business Saturday Campaign
- December 2, a new Legislature for the 2025-2026 session convenes for organizational purposes and to collect a per diem before adjourning for the rest of the month.
- January 6, the 2025-2026 session of the California State Legislature opens for regular business.
National
Highlights from Senior Vice President for Federal Government Relations Jeff Brabant’s report
- Beneficial Ownership Reporting Update and Resources
— Legislative: NFIB continues fiercely advocating for H.R.8147 and S.4297 legislation to repeal burdensome Beneficial Ownership Requirements for Small Businesses. The House legislation now boats 50 co-sponsors. Sign the petition here.
— Small Business Legal Center: NFIB filed the lawsuit challenging the Corporate Transparency Act (CTA) and the legality of the beneficial ownership reporting requirements for small businesses. NFIB’s lawsuit argues that the CTA exceeds Congress’s authority over the states, it improperly compels speech and burdens association, it unconstitutionally compels disclosure of private information, and the reporting rule is not in accordance with the law. The U.S. District Court for the Eastern District of Texas had a hearing in the case on October 9, 2024 Texas Top Cop Shop, Inc., et al. v. Garland, et al.
— Compliance Resources: The Financial Crimes Enforcement Network’s (FinCEN) new rule on Beneficial Ownership Information (BOI) took effect as of January 1, 2024. This rule requires corporations, LLCs, or similar entities with 20 or fewer employees and $5 million or less in gross receipts or sales, as reflected in the previous year’s federal tax return, to report their beneficial ownership information to FinCEN. Businesses will have one year (until January 1, 2025) to file if the business was formed before January 1, 2024.
— BOI fact sheet containing up-to-date and pertinent information concerning the rule.
— NFIB BOI landing page with information about filing details can be found here.
— NEW PODCAST: NFIB expert Beth Milito and attorney Caleb Kruckenberg provide a legal update on the new beneficial ownership registry requirement and what it means for small business owners as deadline to file approaches.
This Main Street Minute can also be read on the NFIB California webpage here. Next Main Street Minute October 28.
