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HR 29 Page 1 Date of Hearing: April 2, 2014 ASSEMBLY COMMITTEE ON PUBLIC EMPLOYEES, RETIREMENT AND SOCIAL SECURITY Rob Bonta,

Chair HR 29 (Gomez) As Amended: March 13, 2014 SUBJECT: Relative to outsourcing public services. SUMMARY: Resolves that the California State Assembly opposes outsourcing of public services and assets, urges local officials to become familiar with the provisions of the Taxpayer Empowerment Agenda, and intends to introduce and advocate for responsible outsourcing legislation. Specifically, this bill: 1) Makes a number of findings about the problems associated with outsourcing public services and assets, including that taxpayers often no longer know how their tax dollars are being spent, and the Taxpayer Empowerment Agenda which could be one model that may help ensure transparency, accountability, shared prosperity, and competition in the operation of public services and assets. 2) Resolves that the California State Assembly opposes outsourcing of public services and assets, which harms transparency, accountability, shared prosperity, and competition, and supports processes that give public service workers the opportunity to develop their own plan on how to deliver cost-effective, high-quality service; urges local officials to become familiar with the provisions of the Taxpayer Empowerment Agenda; and, intends to introduce and advocate for responsible outsourcing legislation. FISCAL EFFECT: Unknown. COMMENTS: According to the author, "HR 29 would simply seek to affirm the Assembly's opposition to the outsourcing of public services and assets. HR 29 would also provide support for plans that reduce outsourcing, restore transparency and accountability to the provision of state services, and empower public sector workers to deliver cost-effective, high-quality services for our state's taxpayers." In July of 2013, In the Public Interest (ITPI) released the Taxpayer Empowerment Agenda intended to reign in predatory contracting and help local governments reclaim control of their public services and assets. The Taxpayer Empowerment Agenda is built on four principles: transparency, accountability, shared prosperity and competition. The agenda consists of 11 legislative proposals that are intended to "give taxpayers a say on how their public dollars are spent, allow for scrutiny of how those dollars are spent, and prevents taxpayers from being stuck with a monopoly run by a single corporation for decades." Supporters state, "Since the start of the Great Recession, many states have turned over critical public services to corporations with promises to save money, only to discover that contracts have lacked transparency and basic accountability for taxpayers, that workers are receiving lower wages and fewer benefit when they need them most, and that the quality of work is often much lower than promised, resulting in further costs. The Taxpayer Empowerment Agenda is a series of specific recommendations, including that information about state contracts are publically

HR 29 Page 2 available, that companies that avoid paying taxes or break the law cannot receive contracts, that contracting companies pay a living wage, and that savings for taxpayers, rather than corporate profits, are guaranteed. The Agenda is a win-win-win for California, for taxpayers and for workers, both public and private." Opponents state that they have "grave concerns about this resolution which would have legislators take a form of pledge that would potentially restrict their votes on future legislation consistent with the political agenda of an outside national organization. Such efforts undermine the democratic process and representative government and do constituents a disservice by preempting legislators'' ability to make an informed decision about the specific impacts of legislation. Local governments have a long history of addressing service delivery challenges with creativity, self-reliance, and innovation. Local elected officials are held accountable for these carefully thought out financial decisions." Opponents conclude, "The Great Recession has placed great strain on municipalities and their ability to provide a full range of services for their residents. This has been compounded by recent state take-aways including the loss of redevelopment and expanding pension and retiree health care obligations. Further limiting the ability to consider alternative methods of providing services after objective review would do a grave disservice to our communities." REGISTERED SUPPORT / OPPOSITION: Support American Federation of State, County and Municipal Employees (Sponsor) Association for Los Angeles Deputy Sheriffs California Association of Professional Employees California Professional Firefighters In the Public Interest Los Angeles Alliance for a New Economy Los Angeles Deputy Probation Officers Union Los Angeles Police Protective League Professional Engineers in California Government Riverside Sheriffs' Association Working Partnerships USA Opposition California Bus Association California Chamber of Commerce California Contract Cities Association California Refuse Recycling Council California Special Districts Association Charles Abbott Association, Inc. City of Artesia City of Brentwood City of Burbank City of Claremont City of Concord

HR 29 Page 3 City of Daly City City of Diamond Bar City of Downey City of Fort Bragg City of Indian Wells City of La Canada Flintridge City of La Mirada City of La Verne City of Lakeport City of Lakewood City of Lathrop City of Livermore City of Merced City of Morgan Hill City of Monterey City of Napa City of Norwalk City of Oroville City of Pomona City of Rancho Cordova City of Redding City of Riverside City of Rosemead City of Sacramento City of Salinas City of San Carlos City of San Mateo City of San Rafael City of Scotts Valley City of Signal Hill City of Soledad City of Tulare City of Vacaville City of Walnut City of West Covina City of Whittier El Monte/South El Monte Chamber of Commerce Glendale city Employees Association Greater Merced Chamber of Commerce League of California Cities Los Angeles County Business Federation Los Angeles County Division of the League of California Cities Marin County Council of Mayors and Council Members Marin Sanitary Service Organization of SMUD Employees San Bernardino Public Employees Association San Luis Obispo County Employees Association Southwest California Legislative Council Town of Danville

HR 29 Page 4 Town of Ross Zanker Road Resource Management

Analysis Prepared by:

Karon Green / P.E., R. & S.S. / (916) 319-3957