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Late Legislative Scramble Will Have Big Impact On Business

Late Legislative Scramble Will Have Big Impact On Business

With the state budget finally signed, attention turns to the annual rush of bills trying to beat the Aug. 31 end-of-session deadline. The next two weeks will determine the fate of dozens of bills that could have broad impacts on the state’s business community.

The biggest battle is likely to be over redesigning the state’s badly broken electricity market. Gov. Arnold Schwarzenegger, independent power producers and major business groups favor reintroducing the choice of providers for major customers, while electric utilities are backing a bill by Assembly Speaker Fabian Nu & #324;ez that would offer more limited customer choice.

Also on tap is a revamp of the state’s virtually insolvent unemployment insurance trust fund. There are two competing approaches: business groups want to restrict eligibility, roll back recent benefit increases and rein in fraud, while labor wants to hike the tax rates that businesses pay.

Other key bills in the hopper would raise the minimum wage by $1 to $7.75 per hour, raise damage awards and penalties against businesses found to violate gender pay equity laws, restrict businesses’ ability to outsource jobs and restrict the ability of auto dealers to mark up loan rates.

With the governor’s popularity down slightly after the monthlong budget deadlock, legislators may be more willing to challenge Schwarzenegger, which could prompt the governor to roll out his veto pen.

But on the energy and unemployment insurance bills , especially the latter , some sort of action is needed to head off major problems. That will set the stage for intense end-of-session negotiations.

Open Primary Challenge

The saga of the open primary measure on November’s statewide ballot, which has taken some unusual turns of late, will likely be determined in the courthouse before voters have their say.

The original measure, Proposition 62, sets out a Louisiana-style primary, where the top two vote-getters , regardless of party , face each other in the general election. The idea is to reduce party influence in the primaries that tends to produce candidates with more extreme politics.

Last month, the Legislature hurried a measure through that would effectively gut this central provision, giving political parties the right to determine which of their candidates advance to the general election. To sweeten the pot for voters, legislators included in the measure now known as Proposition 60 another proposal making it easier for the state to sell off assets and use the proceeds to reduce the budget deficit.

Proponents of the original measure sued in state court, saying Proposition 60 violates the single-subject rule. On July 27, the 3rd District Court of Appeal agreed, but instead of throwing the measure out, the court said each proposal could be put on the ballot separately.

That decision prompted Proposition 62 proponents to file an appeal with the state Supreme Court. To resolve this dispute, the state Supreme Court must rule quickly: The deadline for printing up supplementary ballots is Aug. 29.

Howard Fine covers statewide business issues for the Los Angeles Business Journal.

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