BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 2624
                                                                  Page  1

          Date of Hearing:   May 14, 2014

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                  Mike Gatto, Chair

                   AB 2624 (Medina) - As Amended:  April 21, 2014 

          Policy Committee:                              Business and  
          Professions  Vote:                            12 - 2

          Urgency:     No                   State Mandated Local Program:  
          Yes    Reimbursable:              No

           SUMMARY  

          This bill prohibits the sale or offer for sale in California any  
          product claiming to be "Made in North America," "North American  
          Made," or similar words, unless all or virtually all of the  
          product was made in the United States, Canada or Mexico, the  
          violation of which will constitute an unfair business practice.

           FISCAL EFFECT  

          Negligible fiscal impact.

           COMMENTS  

           1)Purpose  . Supporters, fence builders and small business owners,  
            note that the Federal Trade Commission (FTC) allows for a  
            'Made in USA' designation if 70% of the product is either  
            sourced or manufactured within the US. The State of CA  
            requires a 100% threshold which they contend is unreasonable  
            and in most cases unattainable.   

           2)Previous legislation  .  

             a)   SB 12 (Corbett), Chapter 541, Statutes of 2013,  
               established the Made in California Program in the  
               Governor's Office of Business and Economic Development for  
               the purpose of encouraging consumer product awareness and  
               to promote the purchases of products manufactured in  
               California; and provides that it is an unfair method of  
               competition or unfair business practice to use the  
               designated "Made in California" label without participating  
               in the Made in California Program.  








                                                                  AB 2624
                                                                  Page  2


             b)   AB 890 (Jones), 2013, would have aligned California with  
               the Federal standard regarding the use of the terms "Made  
               in U.S.A.", "Made in America", "U.S.A." or similar words  
               when a product or any portion of the product was not  
               substantially produced in the United States.  That bill was  
               held in Senate Judiciary Committee.
           
              c)   SB 661 (Hill), 2013, would have permitted the use of a  
               "Made in the USA" label for those items whose United States  
               manufacturing costs constitute 90% of the total  
               manufacturing costs for the merchandise.

           Analysis Prepared by  :    Jennifer Swenson / APPR. / (916)  
          319-2081