BILL ANALYSIS                                                                                                                                                                                                    





                             SENATE JUDICIARY COMMITTEE
                         Senator Hannah-Beth Jackson, Chair
                             2015-2016  Regular  Session


          AB 2844 (Bloom)
          Version: June 20, 2016
          Hearing Date: June 28, 2016
          Fiscal: Yes
          Urgency: No
          RD   


                                        SUBJECT
                                           
                          Public contracts:  discrimination

                                      DESCRIPTION  

          This bill would require a person that submits a bid or proposal  
          to, or otherwise proposes to enter into or renew a contract  
          with, a state agency, as defined, to certify, under penalty of  
          perjury, that it has complied with the Unruh Civil Rights Act  
          and the Fair Employment and Housing Act, and that any policy  
          against a Sovereign nation or peoples, including, but not  
          limited to, the nation and people of Israel, are not used as a  
          pretext in violation of those laws.  The provisions requiring  
          self-certification would apply to contracts in the amount of  
          $100,000 or more. This bill would authorize the Attorney General  
          to receive and investigate complaints regarding violations of,  
          and to bring suit to enforce, these provisions.  Lastly, this  
          bill would set forth various findings and declarations regarding  
          the state's anti-discrimination policies and First Amendment  
          rights of individuals, as specified. 

                                     BACKGROUND  

          According to various reports, numerous states across the country  
          have taken action in the last year to withdraw state support for  
          companies participating in a boycott of the State of Israel,  
          known as the Boycott, Divestment and Sanctions (BDS) movement.   
          The BDS Movement website describes BDS as "[t]he global movement  
          for a campaign of Boycott, Divestment and Sanctions (BDS)  
          against Israel until it complies with international law and  
          Palestinian rights [ . . . ].  BDS is a strategy that allows  








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          people of conscience to play an effective role in the  
          Palestinian struggle for justice. [ . . . ] The campaign for  
          [BDS] is shaped by a rights-based approach and highlights the  
          three broad sections of the Palestinian people: the refugees,  
          those under military occupation in the West Bank and Gaza Strip,  
          and Palestinians in Israel. The call urges various forms of  
          boycott against Israel until it meets its obligations under  
          international law by: (1) [e]nding its occupation and  
          colonization of all Arab lands occupied in June 1967 and  
          dismantling the Wall; (2) [r]ecognizing the fundamental rights  
          of the Arab-Palestinian citizens of Israel to full equality; and  
          (3) [r]especting, protecting and promoting the rights of  
          Palestinian refugees to return to their homes and properties as  
          stipulated in UN Resolution 194." (BDS Movement, Introducing the  
          BDS Movement  [as of Jun. 25,  
          2016].)


          According to reports and information provided by the author,  
          legislatures across the country are enacting bills in a display  
          of disapproval of the BDS movement.  The author cites among the  
          states that have passed laws the states of Florida, South  
          Carolina, Indiana, Iowa, Illinois, Colorado, and Arizona, and  
          notes that a handful of others are considering pending  
          legislation on this issue as well.  As described in one article:  


            The trend began last year, when both Illinois and South  
            Carolina virtually unanimously passed bills withdrawing state  
            support for companies participating in BDS.  South Carolina's  
            bill wasn't targeted towards Israel specifically, but  
            prohibited state contracting with companies participating in  
            boycotts based on race, religion or ethnicity.  Illinois' bill  
            was more direct - the state pension fund would divest from any  
            companies refusing to do business in Israel or in the  
            territories.

            This year, however, the pace has picked up considerably.   
            First, Indiana passed a pension divestment bill that Gov. Mike  
            Pence (R) signed this week.  Then, in February, Florida  
            enacted a law prohibiting contracting and implementing  
            divestment at the state and local levels, also irrespective of  
            the Green Line.  Arizona passed a similarly strong bill.  And  
            Colorado's governor signed a law mandating pension divestment  
            from BDS companies.







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            [ . . . ] Georgia is currently considering a bill that would  
            end state contracting with BDS companies.  Iowa and California  
            are both hearing similar bills, and bills are likely to be  
            introduced soon in other states, as well.  (Sharf, BDS on the  
            Run in State Legislatures, The Hill (Mar. 28, 2016) <  
            http://thehill.com/blogs/congress-blog/274202-bds-on-the-run-in 
            -state-legislatures> [as of Jun. 24, 2016].) 

          This bill, as it was initially drafted, sought to limit the  
          ability of individuals who boycott to enter into contracts with  
          the State. As it evolved, the bill went on to instead prohibit  
          contracting with companies engaging in discriminatory business  
          actions in furtherance of a boycott of a sovereign nation or  
          peoples, including, but not limited to, the nation of Israel.  A  
          more recent version of this bill would have required that the  
          Attorney General maintain a list of companies that engage in  
          discriminatory business practices in furtherance of a boycott.   
          Before this Committee is now a version that reflects the  
          author's attempt to strike a compromise, recognizing the right  
          of individuals and businesses to exercise their  
          constitutionally-protected freedoms (whether they are of free  
          speech, or religion, or otherwise), but also the right of the  
          State to select its business partners as a market participant,  
          and its obligation to ensure it does not use tax payer money to  
          fund individuals who discriminate in violation of this State's  
          major anti-discrimination laws.
                                CHANGES TO EXISTING LAW
           
           Existing law  , Section 11135 of the Government Code, prohibits  
          any person in this state from being unlawfully denied, on the  
          basis of race, national origin, ethnic group identification,  
          religion, age, sex, sexual orientation, color, genetic  
          information, or disability, full and equal access to the  
          benefits of, or the unlawful discrimination under, any program  
          or activity that is conducted, operated, or administered by the  
          state or by any state agency, is funded directly by the state,  
          or receives any financial assistance from the state.  (Gov. Code  
          Sec. 11135(a).)  

           Existing law  , Section 11135, imports various definitions from  
          FEHA and the Unruh Civil Rights Act for certain protected bases,  
          including "disability," "sex or sexual orientation," and  
          "genetic information."  (Gov. Code Sec. 11135(c)(1), (e), (g).)   
          Existing law provides, for these purposes, that "race, national  







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          origin, ethnic group identification, religion, age, sex, sexual  
          orientation, color, or disability" includes a perception that a  
          person has any of those characteristics or that the person is  
          associated with a person who has, or is perceived to have, any  
          of those characteristics.  (Gov. Code Sec. 11135(f).)  
           
          Existing law  , the Unruh Civil Rights Act, provides that all  
          persons in California are free and equal, and regardless of a  
          person's sex, race, color, religion, ancestry, national origin,  
          disability, medical condition, genetic information, marital  
          status, sexual orientation, citizenship, primary language, or  
          immigration status, everyone is entitled to the full and equal  
          accommodations, advantages, facilities, privileges, or services  
          in all business establishments.  (Civ. Code Sec. 51.)  Existing  
          law defines "sex" to include, but not be limited to, a person's  
          gender, which, in turn, includes a person's gender identity and  
          gender expression, as specified.  (Civ. Code Sec. 51(e)(5).) 
          
           Existing law  , the Unruh Civil Rights Act, provides definitions  
          for various protected bases and imports certain definitions from  
          FEHA.  (Civ. Code Sec. 51(e).) The Unruh Civil Rights Act,  
          further provides that "sex, race, color, religion, ancestry,  
          national origin, disability, medical condition, genetic  
          information, marital status, sexual orientation, citizenship,  
          primary language, or immigration status" includes a perception  
          that the person has any particular characteristic or  
          characteristics within the listed categories or that the person  
          is associated with a person who has, or is perceived to have,  
          any particular characteristic or characteristics within the  
          listed categories.  (Civ. Code Sec. 51(e)(6).)

           Existing law  , the Fair Employment and Housing Act (FEHA),  
          prohibits discrimination in housing and employment on the basis  
          of race, religious creed, color, national origin, ancestry,  
          physical disability, mental disability, medical condition,  
          genetic information, marital status, sex, gender, gender  
          identity, gender expression, age, sexual orientation, or  
          military and veteran status.  (Gov. Code Sec. 12920 et seq.)  

           Existing law  , FEHA, provides specific definitions for various  
          protected bases (Gov. Code Sec. 12926) and further provides that  
          "race, religious creed, color, national origin, ancestry,  
          physical disability, mental disability, medical condition,  
          genetic information, marital status, sex, age, sexual  
          orientation, or military and veteran status" includes a  







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          perception that the person has any of those characteristics or  
          that the person is associated with a person who has, or is  
          perceived to have, any of those characteristics.  (Gov. Code  
          Sec. 12926(o).)  

           Existing law  provides that whenever there is reasonable cause to  
          believe that any person or group of persons is engaged in  
          conduct of resistance to the full enjoyment of any civil or  
          personal rights, as specified, and that conduct is of that  
          nature and is intended to deny the full exercise of those  
          rights, the Attorney General, any district attorney or city  
          attorney, or any person aggrieved by the conduct, may bring a  
          civil action in the appropriate court by filing with it a  
          complaint.  (Civ. Code Sec. 52(c).) 

           Existing law  , the Public Contract Code, requires that bidders or  
          persons entering into contracts with the state to sign various  
          statements or certify various matters under penalty of perjury.  
          For example, the existing code: 
           Authorizes a state entity to require, in lieu of specified  
            verification of a contractor's license before entering into a  
            contract for work to be performed by a contractor, that the  
            person seeking the contract provide a signed statement which  
            swears, under penalty of perjury, that the pocket license or  
            certificate of licensure presented is his or hers, is current  
            and valid, and is in a classification appropriate to the work  
            to be undertaken.  (Pub. Contract Code Sec. 6100(b).)  
           Requires specified departments under the State Contract Code  
            to require from all prospective bidders the completion, under  
            penalty of perjury, of a standard form of questionnaire  
            inquiring whether such prospective bidder, any officer of such  
            bidder, or any employee of such bidder who has a proprietary  
            interest in such bidder, has ever been disqualified, removed,  
            or otherwise prevented from bidding on, or completing a  
            federal, state, or local government project because of a  
            violation of law or a safety regulation, and if so to explain  
            the circumstances. (Pub. Contract Code Sec. 10162.) 
           Requires every bid on every public works contract of a public  
            entity to include a noncollusion declaration under penalty of  
            perjury under the laws of the State of California, as  
            specified.  (Pub. Contract Code Sec. 7106.) 
           Requires every contract entered into by a state agency for the  
            procurement of equipment, materials, supplies, apparel,  
            garments and accessories and the laundering thereof, excluding  
            public works contracts, to require a contractor to certify  







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            that no such items provided under the contract are produced by  
            sweatshop labor, forced labor, convict labor, indentured labor  
            under penal sanction, abusive forms of child labor, or  
            exploitation of children in child labor.  The law further  
            requires contractors ensure that their subcontractors comply  
            with the Sweat Free Code of Conduct, under penalty of perjury.  
             (Pub. Contract Code Sec. 6108.) 

           This bill  would require a person that submits a bid or proposal  
          to, or otherwise proposes to enter into or renew a contract  
          with, a state agency with respect to any contract in the amount  
          of one hundred thousand dollars ($100,000) or more to certify,  
          under penalty of perjury, at the time the bid or proposal is  
          submitted or the contract is renewed, all of the following:
           that they have complied with the Unruh Civil Rights Act; 
           that they have complied with FEHA; and
           that any policy that they have against any sovereign nation or  
            peoples recognized by the government of the United States,  
            including, but not limited to, the nation and people of  
            Israel, is not used as a pretext for discrimination in  
            violation of the Unruh Civil Rights Act or FEHA. 

           This bill  would authorize the Attorney General to receive and  
          investigate complaints regarding violations of, and may bring  
          suit to enforce the provisions, above. 
          
           This bill  would set forth various findings and declarations,  
          including, among other things, the following:  
           California is a leader in protecting civil rights and  
            preventing discrimination;
           California's robust nondiscrimination laws include protections  
            on the basis of religion, race, national origin, sex, sexual  
            orientation, gender identity, gender expression, and  
            disability, among other characteristics;
           California's strong public policy against discrimination is  
            reflected in numerous statutes, including the Unruh Civil  
            Rights Act and FEHA, as specified.  Section 11135 of the  
            Government Code specifically prohibits discrimination on the  
            basis of many of these same characteristics in the conduct,  
            operation, or administration of any program or activity that  
            is by the state or by any state agency, funded directly by the  
            state, or receives any financial assistance from the state.
           both freedom of speech and religion are cornerstones of law  
            and public policy in the U.S., and the Legislature strongly  
            supports and affirms these important freedoms;







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           the exercise of one's First Amendment rights is not a  
            justification for engaging in acts of discrimination;
           California has significant influence in the marketplace. The  
            state at times operates not as a market regulator, but as a  
            market participant, and in this latter role it may determine  
            that companies engaging in discriminatory actions in the  
            conduct and operation of their business adversely affects the  
            state's procurement activities and places the state in a  
            position of supporting activities that could be seen as a  
            violation of the nondiscrimination policies of the State of  
            California; and 
           it is intent of the Legislature to ensure that taxpayer funds  
            are not used to do business with or otherwise support any  
            state or private entity that engages in discriminatory actions  
            against individuals under the pretext of exercising First  
            Amendment rights. This includes, but is not limited to,  
            discriminatory actions taken against individuals of the Jewish  
            faith under the pretext of a constitutionally protected  
            boycott or protest of the State of Israel.
                                           
                                       COMMENT
           
          1.   Stated need for the bill  

          According to the author: 

            Since 2004, organized campaigns around the world have promoted  
            a policy of Boycott, Divestment and Sanctions (BDS) against  
            Israel. Campaigns have been launched demanding the  
            "divestment" of university, municipal, church, union and other  
            investment portfolios from companies that do business with  
            Israel, as well as the banning of Israeli products,  
            professionals, academics, academic institutions and artistic  
            performances (in Israel and abroad).  The arbitrary nature of  
            these boycotts and divestments has caused concern about  
            financial uncertainty within investment portfolios and has  
            caused corporations to stray from their fiduciary  
            responsibilities.

            In July 2015, the Legislature affirmed its support for [a  
            memorandum of understanding (MOU) between the Governor of  
            California and the Prime Minister of Israel for strategic  
            partnerships for joint innovation, exchanges, and cooperation  
            between California and Israel] by passing SCR 25, noting that  
            participants in the MOU had already expanded cooperation  







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            between Israel and California in areas such as alternative  
            energy, agriculture, business innovation, and academia, and  
            declaring that collaboration with Israel will foster peace and  
            democracy in the Middle East.

            Companies adhering to boycotts of Israel undermine the  
            aforesaid policy and purpose of encouraging trade, business,  
            and academic cooperation between California and Israel.  
            Therefore, it is in the best interest of the State of  
            California that it not contract with any company participating  
            in a boycott of Israel.
            Although the state has affirmed its relationship with Israel  
            through SCR 25, it has yet to take any binding action on the  
            BDS movement. Numerous states around the country have passed  
            such legislation and California, as one of Israel's partners,  
            cannot stay silent.  

          The Jewish Public Affairs Committee of California (JPAC) writes  
          in support of the current bill, noting the bill now requires  
          compliance with "two landmark civil rights laws that prohibit  
          discrimination based on race, religion, sexual orientation, age,  
          and a number of additional categories" as well as the  
          requirement that any policy against a sovereign nation or  
          peoples, including but not limited to the nation and people of  
          Israel, is not used a pretext for discrimination in violation of  
          those two laws. JPAC encourages the Legislature and elected  
          officials to formally increase economic and cultural ties  
          between California and Israel, and expresses support for the MOU  
          between the Governor and the Prime Minister of Israel.  JPAC  
          asserts that the BDS "campaign seeks not only to damage this  
          important relationship[,] but also to demonize and isolate  
          Israel on our campuses, in our communities, and on the world  
          stage.  Moreover, BDS does not further efforts to negotiate a  
          lasting peace for the people of Israel and the Palestinians, but  
          rather seeks to isolate one party rather than build trust and  
          goodwill between both.  With recent BDS efforts intent on  
          harming public opinion of and delegitimizing Israel, there is no  
          more critical time to pass this legislation." 

          Also in support, 30 Years After, an Iranian-American Jewish  
          civil organization, writes that "[w]hen companies participate in  
          boycotts against Israel, they misguidedly single out Israel for  
          unfair treatment and lend support to nefarious anti-Semitic  
          movements across the world that aim to delegitimize Israel.  
          Entering into contracts with such companies is not in the  







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          interests of California or the United States."

          The Sacramento Jewish Community Relations Council (JCRC) also  
          believes that this bill is consistent with the MOU between this  
          State and Israel, and adds in support that, "[t]he Boycott,  
          Divestment, and Sanctions (BDS) movement promotes falsehoods  
          against the Jewish State and also rejects the accepted view of a  
          two-state solution. Those involved with BDS are not interested  
          in peace and security for Israelis and Palestinians; rather  
          their goal is to isolate and delegitimize the State of Israel.  
          Those companies who boycott or divest from Israel are hindering  
          any chances for peace by creating economic hardships for both  
          Israelis and Palestinians."

          2.   Bill now distinguishes between boycotts and unlawful  
          discrimination  

          As noted in the Background, this bill began as legislation that  
          was intended to prohibit public entities in the State of  
          California from entering into contracts with any companies that  
          participate in a boycott of Israel.  The bill, however, has  
          gradually evolved, in what appears to be recognition by the  
          author that there is a substantial difference between the  
          government refusing to contract with someone who engages in an  
          illegal practice, on the one hand, and the government refusing  
          to contract with someone who engages in a legal boycott, on the  
          other hand.  As recently amended, the bill in no way prohibits  
          any action based upon the boycott activities of an individual,  
          nor does the bill require a state "list" of those who boycott.  
          While the term "boycott" remains a point of contention for the  
          opposition, staff notes that it is only mentioned in uncodified  
          intent language describing the intent of the Legislature to  
          ensure that taxpayer funds are not used to do business with or  
          otherwise support entities that engage in discriminatory actions  
          against individuals under the pretext of exercising First  
          Amendment rights. That language provides, by way of example,  
          that this includes, but is not limited to, discriminatory  
          actions taken against individuals of the Jewish faith under the  
          pretext of a constitutionally protected boycott or protest of  
          the State of Israel.  

          The United States Supreme Court, dating as far back as the  
          1940s, has recognized that the Constitution's rights of speech  
          and association protect various forms of protest, beginning with  
          union organizing and the picket line.  (See e.g. Thornhill v.  







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          Alabama (1940) 310 U.S. 88, where the Court recognized the  
          public's First Amendment interest in open discussion of strikes,  
          striking down an anti-picketing ordinance as overbroad.)  In the  
          1960s, legal advocates stood on the precedents won by organized  
          labor to urge the Supreme Court to expand First Amendment  
          protections to protect civil rights.  In 1982, in NAACP v.  
          Claiborne Hardware, the Court upheld the constitutionality of  
          NAACP boycotts held in retaliation against businesses that  
          engaged in race discrimination. The Court recognized the  
          "importance of freedom of association in guaranteeing the right  
                   of people to make their voices heard on public issues," and held  
          that the consumer boycotting and picketing in Claiborne Hardware  
          clearly involved First Amendment activity and thus deserved  
          protection.  (See NAACP v. Claiborne Hardware Co. (1982) 458  
          U.S. 886.)  As explained by the Court, "[t]he established  
          elements of speech, assembly, association, and petition, 'though  
          not identical, are inseparable.' Thomas v. Collins [(1945) 323  
          U.S. 516, 530]. Through exercise of these First Amendment  
          rights, petitioners sought to bring about political, social, and  
          economic change.  Through speech, assembly, and petition --  
          rather than through riot or revolution -- petitioners sought to  
          change a social order that had consistently treated them as  
          second-class citizens."  (Claiborne, 458 U.S. at 911-912.) 

          While this long-standing Supreme Court case law upholds boycott  
          as a protected form of First Amendment activity, as with all  
          rights, the right does not exist in a vacuum and can at times  
          conflict with the rights of others.  For example, while the  
          right might protect picketing or an economic boycott, it does  
          not protect a right to do so in a violent manner. In this vein,  
          the First Amendment also does not write a blank check for those  
          exercising their protected rights to engage in acts of unlawful  
          discrimination against other individuals on the basis of their  
          race, sex, gender, or religion, among other things, in their  
          places of work, school, or government services.  

          Again, while AB 2844 in its original form would have prohibited  
          state contracts with businesses that engage in boycotts against  
          Israel, it now more reasonably reflects a public policy  
          disfavoring state contracts with businesses or entities that are  
          not in compliance with the state's anti-discrimination laws.   
          This is a critical distinction, because while the state can, as  
          a market participant, decide the terms upon which it will enter  
          into a contract, there is a question as to what it can base  
          those decisions on: it is one thing to preclude state contracts  







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          with a business that actively and unlawfully discriminates  
          against people on the basis of protected characteristics; it's  
          another to withhold contracts based solely on political  
          statements or activities, which is tantamount to penalizing a  
          person for exercising his or her constitutional rights.  This  
          bill arguably now falls into the former category, thus  
          minimizing the critical constitutional questions that previously  
          overshadowed the bill.  

          Notably, while the opposition suggests that this bill still bars  
          government contracts with businesses that boycott, staff notes  
          that the plain text of the Public Contract Code section proposed  
          by this bill contains no such reference to the term "boycott."    
          Thus, unless boycotts inherently involve actions that would be  
          in violation of the Unruh Civil Rights Act or the Fair  
          Employment and Housing Act, this bill does not, on its face,  
          prohibit contracting with companies that boycott. To this end,  
          however, the author may wish to consider further replacing any  
          references in the findings and declarations to "discrimination"  
          with "unlawful discrimination," for added clarity.  

          3.    Using taxpayer funds to enter into contracts with  
            businesses or entities that discriminate in violation of state  
            anti-discrimination laws would be inconsistent with this  
            state's strong public policy against discrimination  

          As noted in the Background, the author has recently amended the  
          bill to gut and amend the prior version which would have raised  
          potential questions regarding the First Amendment and chilling  
          effects of a "blacklist" maintained by the Attorney General.   
          This bill now represents a compromise which would help ensure  
          that the state does not enter into contracts that would use  
          taxpayer dollars to fund entities or businesses that would  
          discriminate against individuals on protected bases, such as  
          race, religion, sex, sexual orientation, disability, or  
          nationality, in violation of California's anti-discrimination  
          laws, including Unruh or FEHA.  Specifically, this bill would  
          require any person that submits a bid or proposal to, or that  
          otherwise proposes to enter into or renew a contract of $100,000  
          or more with a state entity, to certify, under penalty of  
          perjury, at the time the bid or proposal is submitted, or the  
          contract is renewed, that they have complied with both the Unruh  
          Civil Rights Act and the Fair Employment and Housing Act. This  
          bill would further require that the person certify that any  
          policy that they have against a sovereign nation or peoples  







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          recognized by the government of the United States, including but  
          not limited to the nation of Israel, is not used a pretext for  
          discrimination in violation of the Unruh Civil Rights Act or  
          FEHA.   

          Further, consistent with existing law, which allows the Attorney  
          General (AG) to bring suits against those businesses in  
          violation of the Unruh Civil Rights Act, this bill would  
          authorize the AG to receive and investigate complaints regarding  
          violations and to bring suit to enforce these provisions.   
          Notably, the bill leaves any such actions to the discretion of  
          the AG and does not require that the AG investigate or bring  
          suit in each instance in which an allegation is made.  Thus, if,  
          for example, the AG does not find the complaint to set forth  
          sufficient information to launch an investigation, or if upon  
          investigation the AG does not believe sufficient evidence exists  
          to bring suit, nothing in this bill would require the AG to take  
          further actions.  

          As accurately reflected in the findings and declarations of this  
          bill, California law evidences a strong public policy of  
          protecting individuals against discrimination under numerous  
          statutes, covering a variety of contexts.  Together, FEHA and  
          the Unruh Civil Rights Act operate to prohibit discrimination in  
          employment, housing, public accommodation, and services provided  
          by business establishments on the basis of specified personal  
          characteristics, such as sex, race, color, religion, ancestry,  
          national origin, age, disability, medical condition, genetic  
          information, marital status, or sexual orientation.  (See Gov.  
          Code Sec. 12920 et seq. for FEHA; Civ. Code Sec. 51 for Unruh  
          Civil Rights Act).  Separately, Section 11135 of the Government  
          Code specifically prohibits discrimination on the basis of many  
          of these same characteristics in the conduct, operation, or  
          administration of any program or activity that is by the state  
          or by any state agency, funded directly by the state, or  
          receives any financial assistance from the state.  

          Notably, even in the absence of this bill, a company in this  
          state would have to comply with both the Unruh Civil Rights Act  
          and FEHA. This bill would merely require that they certify that  
          they are in compliance with these state anti-discrimination laws  
          and ensures that the state does not use taxpayer moneys to fund  
          large scale contracts for goods or services with another entity  
          or business that does not comply with Unruh or FEHA, which could  
          be seen as funding discrimination and send contradictory  







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          messages to the Californians who are protected by those very  
          laws. If a state agency were to contract with a business or  
          entity that is not in compliance with these laws, it would not  
          only undermine the State's strong public policy against  
          discrimination, but could arguably put the State in the position  
          of violating Government Code Section 11135 as well.   Likewise,  
          while California may not be able to regulate those companies by  
          applying California law to out-of-state businesses that do not  
          do business in the state of California, the State can arguably,  
          as a market participant, decide that it will not enter into  
          contracts for goods with those companies if they do not meet its  
          nondiscrimination standards-again, avoiding the use of taxpayer  
          moneys to fund entities that engage in activities that would  
          constitute discrimination if committed in California.  

          Indeed, while the impetus for the author and proponents of this  
          bill surrounds the BDS movement and acts of discrimination they  
          believe are associated with that movement, the underlying  
          language of this bill applies more expansively, to ensure that  
          California taxpayer moneys do not fund discrimination on the  
          basis of any protected characteristic.  By way of example, if an  
          out-of-state company prohibits transgender customers or  
          employees from using their restrooms in accordance with their  
          gender or gender identity, pursuant to that other state's laws,  
          such a company might not be able to certify that they are in  
          compliance with Unruh or FEHA.  As a result, under this bill,  
          this State can be assured that a state agency could not do  
          business with that company in amounts over $100,000.  However,  
          if another company in that same state does not engage in such  
          acts of discrimination which would be tantamount to unlawful  
          discrimination in California, they could certainly certify that  
          they are in compliance with California's anti-discrimination  
          laws and could successfully bid, enter into, or renew a contract  
          with a California state agency.   
           
          Thus, as a matter of public policy, this bill appears to set  
          forth a principle that California will not partner with and  
          finance business with entities or businesses that do not meet  
          this State's strong non-discrimination standards.   As a  
          technical matter, staff notes that the bill, as currently  
          drafted, potentially suggests that the person seeking to bid on,  
          enter into, or renew a contract with California would have to  
          certify that they have always complied with Unruh or FEHA, when  
          it appears that the author's intent is to ensure that they are  
          currently in compliance with these laws.  To avoid any inference  







          AB 2844 (Bloom)
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          that a person would have to certify that they "have [for all of  
          time] complied with" Unruh and FEHA, the author may wish to  
          avoid such unintended consequences by simply replacing the  
          phrases "have complied" with "are in compliance with." 

          4.   Policies used as a pretext for unlawful discrimination  

          This bill would also require that a person bidding on, renewing,  
          or entering into a contract with a state entity certify that  
          they do not have a policy against a sovereign nation or peoples,  
          including, but not limited to the nation and people of Israel,  
          that is used as a pretext for discrimination in violation of the  
          Unruh Civil Rights Act or FEHA.  

          Notably, some of the opposition to this bill (see Comment 5)  
          asserts that the bill creates a new crime "if a bidder certifies  
          under penalty of perjury that 'any policy that they have adopted  
          against any sovereign nation or peoples recognized by the  
          government of the United States, including, but not limited to,  
          the nation and people of Israel, is not used as pretext for  
          discrimination in violation of the Unruh Civil Rights Act or the  
          California Fair Employment and Housing Act.'" However, it is  
          important to note that a person would be guilty under penalty of  
          perjury only if they falsely certified this fact.  Moreover, in  
          order to be deemed to have falsely certified this fact, it would  
          not be enough that the person had a policy against the nation  
          and peoples of Israel or other sovereign nation or peoples-the  
          language requires that an element of discrimination in violation  
          of FEHA or Unruh Civil Rights Act exist as well.

          5.   Opposition  

          Staff notes that many of the letters of support and opposition  
          received are in regard to the prior versions of this bill.   
          Because they have not removed or changed their registered  
          positions, they remain listed at the end of this analysis.  To  
          the extent letters are quoted in this analysis, they are from  
          letters submitted specifically in support or opposition to the  
          current version of the bill.  

          The Asian Pacific American (APA) Democratic Caucus writes that  
          it opposes this bill's "attempt to silence non-violent efforts  
          to speak truth to power," asserting that the bill would  
          "suppress companies and organizations from using boycott,  
          divestment, and sanctions (BDS) against any country that the  







          AB 2844 (Bloom)
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          United States supports."  The APA Democratic Caucus adds that  
          "[i]t is beyond ironic that the California legislature would  
          seek to silence the voices of conscience against the powerful  
          since BDS is a tool that this state and this country have used  
          against other states and countries when the latter were believed  
          to be violating human rights." 

          A group of organizations known as the "Stop AB 2844 Coalition"  
          writes in opposition that while the "odious [blacklist  
          provision] of the bill has now been removed" AB 2844 remains  
          problematic because it: (1) singles out boycotts of Israel; (2)  
          restores an unconstitutional ban on state contracts with Israel;  
          (3) targets private entities and not just for-profit businesses;  
          (4) creates a new crime in violation of the Due Process Clause  
          for vagueness, (5) caters to the characterization of boycotts  
          and protests of Israel as "anti-Semitic," (6) unconstitutionally  
          profiles those who boycott Israel as likely to violate  
          anti-discrimination laws; and (7) invites Israel-aligned  
          organizations to file a barrage of complaints with the Attorney  
          General's office demanding that individuals who boycott Israel  
          be banned from public contracts and be subjected to criminal  
          penalties.  More specifically, the coalition writes, among other  
          things, that:

           Israel and its supporters have been unable to counter growing  
            global concern over violations of human rights and violence  
            against Palestinians under Israeli rule, and the accompanying  
            grassroots campaigns to apply economic and moral pressure for  
            change. With AB 2844, the author and supporters seek to  
            sidestep the public forum and instead legislate against such  
            nonviolent, protected speech.  


           [By inserting language relating to the "nation and people of  
            Israel," this bill] suggests the false and dangerous  
            conflation of protests against Israeli government policies  
            with attacks on Jews everywhere, who are sometimes referred to  
            in a historical, ethnic sense as "the people of Israel" and  
            whom the government of Israel often claims to represent.  It  
            also suggests that the bill is intended to protect Jews within  
            Israel and around the world from the imagined discriminatory  
            acts associated with boycotts of Israel, even though the  
            anti-discrimination laws referred to in the bill protect  
            residents of California only. [ . . . ]








          AB 2844 (Bloom)
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           [I]f private entities are subject to the ban, those affected  
            could include churches affiliated with denominations that have  
            refused to buy goods made in illegal Israel settlements in the  
            West Bank or have divested their funds from corporations  
            complicit in Israel's violations of human rights and  
            international law.  Their state-funded work serving  
            California's most vulnerable populations could be cut off.   
            Similarly, unions, student bodies, universities, charitable  
            foundations or individual socially responsible investors who  
            support boycott of Israel or divestment from complicit  
            corporations or institutions could be banned from doing  
            business with the state. 

           In its latest iteration, AB 2844 creates a new crime - a  
            felony - if a bidder certifies under penalty of perjury (as it  
            requires) that "any policy that they have adopted against any  
            sovereign nation or peoples recognized by the government of  
            the United States, including, but not limited to, the nation  
            and people of Israel, is not used as a pretext for  
            discrimination in violation of the Unruh Civil Rights Act or  
            [FEHA]." 

           The concept of using boycott "as a pretext for discrimination"  
            has never before been invoked or defined under California law.  
            By any measure, it is unconstitutionally vague under the Fifth  
            Amendment's Due Process Clause. The key constructs of the void  
            for vagueness doctrine were enunciated by the Supreme Court  
            are as follows: 

          [T]he terms of a penal statute [...] must be sufficiently  
          explicit to inform those who are subject to it what conduct on  
          their part will render them liable to its penalties, ? and a  
          statute which either forbids or requires the doing of an act in  
          terms so vague that men of common intelligence must necessarily  
          guess at its meaning and differ as to its application violates  
          the first essential of due process of law. [Citing Connally v.  
          General Construction Co. (1926) 269 U.S. 385, 391.) 

           [The term pretext] would involve an inquiry into a person's  
            motivations and subjective intent, and would compel the  
            Attorney General's office to function as thought police.

           Israel-aligned organizations routinely flood university  
            administrators, the U.S. Department of Education and the  
            courts with complaints that boycotts and protests of Israel  







          AB 2844 (Bloom)
          Page 17 of ? 

            are anti-Semitic. [ . . . ] Legislators should be aware of the  
            floodgates that will open if the latest version of AB 2844 is  
            passed, and of the burden that will be placed on the Attorney  
            General's Office both to process complaints and to repeatedly  
            act as a surrogate for the courts in the arduous task of  
            trying to determine when protected political speech is somehow  
            "discriminatory."



           Support  :  Agudath Israel of California; Alpha Epsilon Pi  
          Fraternity, Inc.; Alpha Epsilon Pi, California Polytechnic State  
          University, San Luis Obispo; Alpha Epsilon Pi, Chapman  
          University; Alpha Epsilon Pi, Claremont Colleges; Alpha Epsilon  
          Pi, CSU, Chico; Alpha Epsilon Pi, CSU, Fullerton; Alpha Epsilon  
          Pi, CSU, Northridge; Alpha Epsilon Pi, CSU, San Jose; Alpha  
          Epsilon Pi, UC Berkeley; Alpha Epsilon Pi, UC Davis; Alpha  
          Epsilon Pi, UC Irvine; Alpha Epsilon Pi, UCLA; Alpha Epsilon Pi,  
          UC Riverside; Alpha Epsilon Pi, UC Santa Cruz; Alpha Epsilon Pi,  
          UC Santa Barbara; Alpha Epsilon Pi, UC San Diego; Alpha Epsilon  
          Pi, San Diego State University; Alpha Epsilon Pi, San Francisco  
          State University; American Jewish Committee; Arm Organization;  
          Beit David Congregation; B'NAI B'RITH of Fariborz Matloob; Beth  
          Abraham; Bruins for Israel; Bruin-Israel Public Affairs  
          Committee; California Teamsters Public Affairs Council; Chabad  
          of San Diego State University; City of Beverly Hills; City of  
          West Hollywood; Cohen Synagogue, Inc.; Concerned Women for  
          America; Democrats for Israel Los Angeles; Eretz Cultural  
          Center; ETTA Israel; Hadassah Haifa; Hadassa Malka; J Street;  
          Iranian Jewish Senior Center; Iranian Jewish Women's  
          Organization; Israeli-American Council; Israeli-American Nexus;  
          Jewish Community Relations Council of San Francisco; Jewish  
          Public Affairs Committee of California (as amended); Iranian  
          American Jewish Federation; Iranian Jewish Women's Organization;  
          Magbit Foundation; Namat USA; Nessah Educational & Cultural  
          Center; Ohel Moshe Congregation; Ohr Haemet Institute; ORT  
          Organization; Religious Action Center of Reform Judaism; Torat  
          Hayim; Trojans for Israel; Sacramento Jewish Community Relations  
          Council; Simon Wiesenthal Center; SC Students Supporting Israel;  
          StandWithUs; Students Supporting Israel at UCLA; 30 Years After

           Opposition  :  American-Arab Anti-Discrimination Committee;  
          American Civil Liberties Union; American Friends Service  
          Committee; American Muslims for Palestine, various chapters;  
          Arab American Civic Council; Arab American Caucus, California  







          AB 2844 (Bloom)
          Page 18 of ? 

          Democratic Party; Arab American Cultural Center of Silicon  
          Valley; Arab Resource and Organizing Center, SF Bay Area; Asian  
          Pacific American Democratic Caucus; Bay Area Women in Black;  
          BDS-LA for Justice in Palestine; Bill of Rights Defense  
          Committee; Center for Constitutional Rights; Chico Palestine  
          Action Group; Coalition of Palestinian American Organizations;  
          Cognitive Liberty; Council on American Islamic Relations,  
          California; Culture and Conflict Forum; Davis Committee for  
          Palestinian Rights; Defending Dissent Foundation; East Timor  
          Action Network; Episcopal Peace Fellowship, Palestine Israel  
          Network; Episcopal Peace Fellowship, Palestine Israel Network,  
          LA; Free Palestine Movement;  Friends Committee on Legislation,  
          California; Friends of Sabeel North America; If Americans Knew;  
          International Jewish Anti-Zionist Network (IJAN); International  
          Solidarity Movement, Northern California; Islah Reparations  
          Project; Islamic Shura Council of Southern California; Israel  
          Palestine Task Force of the California Nevada Conference of  
          United Methodists; Jewish Voice for Peace, various chapters;  
          Justice for Palestinians, San Jose; Kairos USA; Keep Hope Alive  
          -- Bay Area Presbyterians; LA Jews for Peace; Middle East Peace  
          Task Force, Southwest California;  Synod, Evangelical Lutheran  
          Church; National Lawyers Guild, various chapters; North Coast  
          Coalition for Palestine; Northern California Islamic Council;  
          Our Developing World; Palestine American Congress; Palestine  
          American League; Palestine Israel Action Committee;  
          Palestine-Israel Working Group of Nevada County; Palestine  
          Legal; Palestine Political Action Committee; Palestinian  
          American Women's Association; Palestinian Youth Movement-USA;  
          Peace Action of San Mateo Co.; Peninsula Peace and Justice  
          Center; People for Palestinian-Israeli Justice; Petaluma  
          Progressives; Pilgrims of Ibillin; Queers Undermining Israeli  
          Terrorism; Ramallah Club of San Jose; Rebuilding Alliance;  
          Resource Center for Non-Violence, Santa Cruz; Sacramento  
          Regional Coalition for Palestinian Rights; San Jose Peace and  
          Justice Center; Social Justice Center of Marin; Stop AB 2844  
          Coalition; Students for Justice in Palestine, various chapters;  
          Sustainable Agriculture Water and Health (SAWAH); Syria  
          Solidarity Movement; UAW 2865 Joint Council/Executive Board;  
          Unitarian Universalists for Justice in the Middle East; United  
          Church of Christ Palestine Israel Network; United Methodist  
          Kairos Response; U.S. Campaign to End the Israeli Occupation;  
          U.S. Palestinian Community Network; Veterans for Peace, Chapter  
          87, Sacramento; Voices for Justice in Palestine, Rossmoor,  
          Walnut Creek; Washington Interfaith Alliance for Middle East  
          Peace; Wellstone Progressive Democrats of Sacramento; Women's  







          AB 2844 (Bloom)
          Page 19 of ? 

          International League for Peace & Freedom, various chapters; 14  
                                                                          Friends of Palestine, Marin County; over 1300 individuals

                                        HISTORY
           
           Source  :  Author 

           Related Pending Legislation  :  

          AB 1552 (Allen, 2016) would generally prohibit a public entity  
          from entering into a contract to acquire or dispose of goods,  
          services, information technology, or construction unless the  
          contract includes a representation that the contractor is not  
          currently engaged in, and will not during the duration of the  
          contract engage in, a boycott, as specified.  The bill is  
          currently in the Assembly Rules Committee. 

          AB 1551 (Allen, 2016) would prohibit the investment of certain  
          state funds in business firms or financial institutions that  
          engage in discriminatory business practices in furtherance or in  
          compliance with the boycott of Israel, as defined.  The bill is  
          currently in the Assembly Rules Committee.

           Prior Legislation  :

          SCR 25 (Block et al., Ch. 127, Stats. 2015) stated the  
          Legislature's recognition and support for the MOU for strategic  
          partnerships for joint innovation, exchanges, and cooperation  
          between California and Israel.

          AB 1151 (Feuer & Blumenfield, Ch. 441, Stats. 2011) required  
          additional public reporting requirements, as specified, by  
          CalPERS and CalSTRS, regarding retirement investments in  
          companies with business operations in Iran.  The bill also  
          clarified the fiduciary duties of CalPERS and CalSTRS regarding  
          investments subject to the CPDIA.

          AB 221 (Anderson, Ch. 671, Stats. 2007) enacted the California  
          Public Divest from Iran Act (CPDIA), which prohibits CalPERS and  
          CalSTRS from investing public employee retirement funds in a  
          company with business operations in Iran, as specified.  

          AB 2251 (Friedman and Margolin, Ch. 1351, Stats. 1992)  
          prohibited state trust fund and state money investments in  
          business firms or financial institutions that engage in  







          AB 2844 (Bloom)
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          discriminatory business practices, as defined, in furtherance of  
          or in compliance with the Arab League's economic boycott of  
          Israel. 

           Prior Vote  :

          Assembly Floor (Ayes 64, Noes 0)
          Assembly Floor (Ayes 26, Noes 50)
          Assembly Appropriations Committee (Ayes 11, Noes 0)
          Assembly Judiciary Committee (Ayes 10, Noes 0)
          Assembly Accountability and Administrative Review Committee  
          (Ayes 5, Noes 1)
          Assembly Rules Committee (Ayes 8, Noes 2)

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