BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 1236
                                                                  Page  1

          Date of Hearing:  August 7, 2002

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                              Darrell Steinberg, Chair

                   SB 1236 (Alarcon) - As Amended:  June 13, 2002 

          Policy Committee:                              Labor and  
          Employment   Vote:                            6-1

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:              

           SUMMARY  

          This bill implements the Governor's Reorganization Plan No. 1 of  
          2002, which creates a Labor and Workforce Development Agency in  
          state government. 

          The Agency would consist of the following state departments,  
          boards and commissions:

             a)   Department of Industrial Relations (DIR).
             b)   Employment Development Department (EDD).
             c)   Agricultural Labor Relations Board (ALRB).
             d)   Workforce Investment Board (WIB).

          1)Provides that the Agency shall be under the supervision of a  
            Secretary appointed by the governor and subject to  
            confirmation by the Senate.

           FISCAL EFFECT  

          The bill would result in annual General and special fund costs  
          of up to $2 million.  The bill states that funding for the new  
          agency shall be achieved by redirecting resources from existing  
          departments, except that no funds shall be provided by the ALRB.

          To accomplish this objective, however, the Legislature would  
          need to identify permanent program reductions in future budget  
          acts to free up the necessary resources.  Such reductions could  
          prove counterproductive to the Agency's mission of improving  
          labor law enforcement.

           COMMENTS  








                                                                  SB 1236
                                                                  Page  2


           1)Background  .  California is the only industrialized state  
            without a cabinet-level labor agency modeled along the lines  
            of the federal Department of Labor. Although the Director of   
            Industrial Relations is a cabinet member, there is little  
            programmatic coordination of labor-related agencies in state  
            government.

           2)Purpose  .  This bill would establish the Labor and Workforce  
            Development Agency, directed by a cabinet-level Secretary,  
            assisted two deputies, all subject to Senate confirmation. The  
            new agency would integrate California's employment and social  
            insurance programs to better serve the public.

          3)  Prior Legislation  .   This bill is similar to SB 25 (Alarcon),  
            which was vetoed last year. In his veto message, the governor  
            stated:  "The working men and women of California and our  
            economy would benefit from a more coordinated effort by the  
            various state departments charged with ensuring a  
            well-trained, healthy, safe and prosperous workforce. I  
            believe that the Department of Industrial Relations and the  
            Employment Development Department could provide better service  
            by being combined within a single entity.  More review,  
            however is necessary to determine what other components of the  
            state, if any, should be organized in this fashion.

            "I have asked my Director of the Department of Industrial  
            Relations to work with the appropriate people and to make a  
            recommendation to me by the end of the year."

            This bill is the result of the recommendation sought by the  
            governor.

           Analysis Prepared by  :    Stephen Shea / APPR. / (916) 319-2081