BILL ANALYSIS �
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THIRD READING
Bill No: SB 823
Author: Corbett (D)
Amended: 5/31/11
Vote: 21
SENATE JUDICIARY COMMITTEE : 3-2, 04/26/11
AYES: Evans, Corbett, Leno
NOES: Harman, Blakeslee
SENATE BUSINESS, PROF & ECON DEVELOP COMM : 6-3, 05/02/11
AYES: Price, Corbett, Correa, Hernandez, Negrete McLeod,
Vargas
NOES: Emmerson, Walters, Wyland
SENATE APPROPRIATIONS COMMITTEE : 6-3, 05/26/11
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Emmerson, Runner
SUBJECT : Consumer protections: Made in California
Program
SOURCE : California Small Business Association
DIGEST : This bill creates the Made in California program
within the Governors Office of Economic Development for the
purpose of encouraging consumer product awareness and to
foster the purchases of products manufactured in
California. This bill also makes it an unfair method of
competition or business practice to use the designated
"Made in California" label without participating in the
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Made in California program.
ANALYSIS : Existing law prohibits unfair methods of
competition, acts or practices by any person which either
results in or is intended to result in the sale or lease of
goods or services to any consumer. Existing law enumerates
several methods of unfair competition, acts or practices.
(Civ. Code Sec. 1770.)
Existing law provides that any consumer who suffers damage
as a result of a practice declared to be unlawful under the
Consumer Legal Remedies Act (CLRA) may bring an action
against that person to recover damages, as specified.
Existing law allows for a class action suit to be filed on
behalf of a class of consumers adversely affected by an
unfair method of competition, act or practice. (Civ. Code
Secs. 1780 and 1781.)
Existing law provides for California to enter into
marketing agreements and to create the "Buy California
Program." (Food & Agr. Code Sec. 58750.)
This bill creates a "Made in California Program" within the
Governor's Office of Economic Development (office) as a
public and private collaboration. This bill states that
the purpose of the program is to encourage consumer product
awareness and to foster purchases of high-quality products
manufactured in this state. This bill allows the office to
develop and adopt standards that permit a company to
represent that a product is made in California.
This bill authorizes the office to issue and make effective
marketing agreements, including, but not limited to,
issuance of a Made in California label. This bill would
allow California companies on a voluntary basis to
participate in the program.
This bill creates a special fund in the State Treasury
known as the Made in California Fund to be funded by an
appropriation by the Legislature if availability of funds
exist.
This bill provides that representing that a product is made
in California when it does not comply with the standards
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adopted by the Governor's Office of Economic Development
(office) would be an unfair or deceptive act or practice
under the CLRA.
This bill provides that the standards adopted by the office
may include:
1.The company primarily designs and manufactures a physical
product, rather than a digital product or a service.
2.The company manufactures one or more products in
California.
3.The company has a California-based workforce and has the
desire to grow that workforce over time.
This bill's provisions relating to the CLRA, would only be
operative after the office has adopted standards for the
Made in California program.
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13
2013-14 Fund
Made in California ProgramUp to $200 initially; future
administration General*
and marketing costs would be determined
by continued General Fund support and
financial contribution of companies
participating in the program
* Made in California Fund, a special fund, would not fund
initial costs
SUPPORT : (Verified 5/31/11)
California Small Business Association (source)
California Conference Board of the Amalgamated Transit
Union
California Conference of Machinists
California Labor Federation
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California Official Court Reporters
California State Council of the Service Employees
International Union
California Teamsters Public Affairs Council
Council for Responsible Genetics
Engineer and Scientists of California
International Longshore and Warehouse Union
Professional and Technical Engineers, Local 21
Small Business California
Tesla Motors, Inc.
UNITE HERE!
Utility Workers Union of America, Local 132
ARGUMENTS IN SUPPORT : According to the author's office:
California's unemployment rate has increased to 12.4
percent, one of the highest rates in the nation.
Nonfarm payroll jobs decrease by 33,500 each month,
according to the California Employment Development
Department. Unemployment is not only a reaction to the
financial crisis, but is also a symptom. Our economy
cannot be sustainable without products made in
California, and our consumer market will continue to
be sluggish until we increase the state's employment
rate. Our main source of employment in the state
continues to be local and small companies.
California is known worldwide for its products, so the
"Made in California" label can help add value to
products made in the Golden State. Because of the high
cost of living in California, companies that choose to
manufacture products in California do so at a higher
cost than they might pay in another state or on
foreign soil, and have made a conscious decision to
embrace local manufacturing as a vital component of
their business strategy. SB 823 would help these
businesses in their marketing efforts.
The California Small Business Association (CSBA) states
that "we feel recognizing products 'Made in California'
will stimulate jobs and the economy. It will also promote
the intent of the legislature and state government to
support these businesses that grow our economy. We
strongly support this legislation and the opportunities it
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will provide our small businesses. CSBA is a non-profit,
grass roots organization representing over 203,000 small
businesses in California. The mission is to provide small
business with an active voice in the California
government."
RJG:nl 5/31/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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