Transcript Highlights:

• of benefits to the members and beneficiaries and for the payment of reasonable expenses.
• than the... ...exclusive benefit of members and their beneficiaries, which then also includes the payment
• What I heard Aaron say was that what was unusual about this set of circumstances is that no payment has
• new fiscal note here based on the bill that we also passed last session in terms of freezing the payment
• on the unfunded liability, because the unfunded liability didn't go away; it just froze payments to

Committee: Joint Select Committee on Pension Policy

Summary: The Select Committee on Pension Policy approved the September minutes and then received a presentation from DRS staff on the FY 2024 CEM benchmarking survey. DRS described its administrative costs, service levels, and technology modernization efforts, noting that its overall service was just below peer averages but had recovered since COVID, and that major projects such as the CorePAM system replacement are a significant driver of costs. Committee members and DRS emphasized that the benchmarking is meant to compare administrative efficiency, not the total cost of benefits, and DRS said the CorePAM project is expected to finish around September 2027. The committee then continued its LEOFF 1 study discussion with staff, the Office of the State Actuary, the Attorney General’s office, Ice Miller, and the State Investment Board. The discussion focused on two legislative approaches: a merger of LEOFF 1, PERS 1, and TRS 1 into a Legacy Plan (5085) and a terminate-and-restate approach for LEOFF 1 (2034). Testimony explained that both approaches could satisfy federal tax requirements if the IRS issues a favorable determination letter and private letter ruling after enactment, and that the merger is viewed as the more conservative option. Witnesses said the exclusive benefit rule prevents surplus assets from being used for non-benefit purposes, but allows them to support benefits and reasonable administrative costs for plan members and beneficiaries. Questions from members centered on whether the IRS would require plan funding above 100 percent, how overfunding could be managed, the effect of prior legislation such as ESSB 5357, and the costs and timing of IRS filings; staff and counsel said the IRS process can take a year or more and recommended waiting for approval before implementation. The committee also adopted preliminary 2026 meeting dates. During public comment, several speakers supported the merger bill because it would permanently eliminate the current LEOFF 1 employer surcharge and provide a permanent COLA for retirees, while others urged caution about creating additional pension burdens for state and local governments. One commenter asked the committee to study climate change as a systemic risk to pension investments, and another requested an ad hoc COLA for Plan 1 retirees in 2026. The meeting ended with no action on the LEOFF 1 study beyond discussion and with the meeting calendar approved.

Transcript Highlights:

• Line 224 is the farm down payment assistance grants program.
• B is for the cost-share payments for the cost of organic certification.
• B is for the cost-share payments for the cost of organic certification.
• B is for the cost-share payments for the cost of organic certification.
• Paragraph C is for the farm down payment assistance grants.

Bills: HF2446

Committee: House Agriculture Finance and Policy

Transcript Highlights:

• Contractors Licensure Fairness Act provides a balanced approach to contractor licensing by allowing partial payment
• Licensure Fairness Act, provides a balanced approach to contractor licensing by allowing partial payment
• Contractors will be able to recover payment for work completed while licensed, even if they were unlicensed
• Current contractor's license law requires total disgorgement of any payment of contractors that operate
• Withholding payments to contractors for a substantial period of time for any reason, and it does happen

Summary: The Senate Business, Professions and Economic Development Committee heard three bills. SB 849 by Senator Weber Pearson would tighten restrictions on physicians and surgeons who committed specified sexual misconduct against patients by barring license renewal petitions, requiring automatic revocation in certain reinstatement cases, and making the changes retroactive to 2020. Support came from the California Medical Association and the American College of OBGYN; there was no opposition in the room. Members praised the bill as closing a loophole and protecting patients, and it passed 8-0 to the Appropriations Committee, placed on call for absent members. SB 96 by Senator Umberg would extend California’s ad volume rules to streaming services, podcasts, and similar content so advertisements cannot be louder than surrounding programming. The author said the bill was prompted by a child being awakened by loud streaming ads and was intended to mirror the federal CALM Act’s approach for television. There was no support or opposition testimony in the room. The committee discussed how the rule might work across platforms and states, then passed the bill 9-0 to Appropriations, also on call. SB 342 by Senator Umberg, the Contractors Licensure Fairness Act, would allow contractors to recover payment for work performed while licensed even if their license lapsed during part of a project, while still denying payment for unlicensed days and preserving penalties for starting work without a license. Supporters included the California Conference of Carpenters, State Building and Construction Trades, and several contractor associations. Committee members raised concerns about consumer protections, burden of proof, and whether the bill could create loopholes, but the author and staff said existing enforcement would remain and the bill would only limit forfeiture to the period of unlicensure. The bill passed 9-0 to Judiciary. At the end of the hearing, the chair announced all three bills were out of committee and thanked staff for their work.

Transcript Highlights:

• Licensure Fairness Act, provides a balanced approach to contractor licensing by allowing partial payment
• Contractors will be able to recover payment for work completed while licensed, even if they were unlicensed
• Current contractor's license law requires total disgorgement of any payment to contractors that operate
• Withholding payments to contractors for a substantial period of time for any reason, and it does happen
• Withholding payments to contractors for a substantial period of time for any reason, and it does happen

Committee: Senate Business, Professions and Economic Development

Summary: The Senate Business, Professions and Economic Development Committee heard three bills. SB 849 by Senator Weber Pearson would address physician sexual misconduct by clarifying that physicians or surgeons who committed specified sexual offenses against patients cannot petition for license renewal, and by requiring automatic revocation in certain misconduct-related cases, including where a license was surrendered, revoked, or the person was convicted or required to register as a sex offender. Support came from the California Medical Association and the American College of OBGYN; there was no opposition in the room. The bill was moved do pass to Appropriations on an 8-0 vote, then later confirmed out on call. SB 96 by Senator Umberg would extend California’s advertising-volume rules to streaming services, podcasts, and similar content by requiring ads to be kept at the ambient level of the surrounding content. The author said the bill was inspired by a child awakened by loud streaming ads and argued it would update the earlier CALM Act for modern media. There was no support or opposition testimony in the room. The committee discussed how the rule might affect platforms operating statewide or nationally, and the bill passed do pass on a 9-0 vote, then was confirmed out on call. SB 342 by Senator Umberg, the Contractors Licensure Fairness Act, would allow contractors to recover payment for work performed while licensed even if they were unlicensed for part of a project, while still barring payment for unlicensed days and preserving existing prohibitions on starting work without a license. Supporters, including representatives of the California Conference of Carpenters, State Building and Construction Trades, and contractor associations, argued the current law can be overly punitive and can create windfalls for owners when a technical lapse is discovered later. Committee members raised concerns about consumer protection, burden of proof, and whether the bill could create loopholes, but the author and supporters said existing protections remain and the bill is intended to be proportional. The bill passed do pass to Judiciary on a 9-0 vote and was later confirmed out on call to Appropriations.

Transcript Highlights:

• amount of the primary residence credit for that year to the state treasurer for when they make that payment
• Year to the state treasurer for when they make that payment to the counties, to move that up about two
• have that done so that the county treasurer then would be required to apportion and distribute the payments
• they need to verify those applications and ensure that the data is correct before they send the payments
• We do have an internal policy, like Linda had said, about getting payments to the counties by April 1st

Bills: SB2397

Committee: Senate Finance and Taxation

Summary: The Senate Finance and Tax Committee met and first took up House Bill 1382, the gas tax bill. Members explained an amendment to ensure that the proposed three-cent gas tax distribution would include all counties and townships in oil-producing counties, rather than excluding non-oil-producing counties as in the original draft. The committee adopted the amendment unanimously, but then held the bill for the time being because of related work on the Department of Transportation budget in the House. The committee then turned to House Bill 1168, a large hoghouse amendment that combined the bill with the contents of House Bill 1176 and added technical corrections. The proposal would raise the primary residence property tax credit maximum from $1,250 to $1,650, keep the 75% cap with a $500 floor, and extend the credit to voter-approved levies while excluding special assessments. Other changes discussed included aligning the disabled veterans property tax credit with the $200,000 exemption level, adjusting budget and distribution dates so taxing districts are made whole sooner, exempting townships from a general-election vote requirement for levy increases, and modifying school funding formulas so schools are not shortchanged if mill levies are reduced under the cap. Testimony from the Association of Counties and the State Supervisor of Assessments was generally supportive of the technical cleanup and implementation changes, but they raised concerns about the June 1 distribution date, application timing, and the practicality of some programming and administrative changes. Committee members also discussed the policy and messaging implications of the 75%/floor structure and the difficulty of applying the credit to certain voter-approved levies. No final action was taken on House Bill 1168; the committee agreed to continue working on amendments and recessed until later in the day.

Transcript Highlights:

• They will provide needed funds to ensure that hospitals and providers can receive timely payment and
• top of that **$3.4 billion** loan, and we believe with that combination we will be able to make payments
• So you're saying that because of the trends that we're seeing right now and the increase in payments,
• billion from the general fund, and the $8 billion in federal funds to cover all of these Medi-Cal payments
• Any of this current payment going back to pay that loan that we took out just a month ago?

Committee: House Budget

Transcript Highlights:

• And so we're seeing... payment due by this time typically they payment due by this time typically they
• We do oppose this legislation, mainly because it's unclear if businesses can refuse payment in coin or
• The witness said the legislation is unclear about whether businesses can refuse payment in coin or bars
• All those premium payments would be for nothing, and if I had known that this program was going to go
• </c><02:21:44.560><c> would</c><02:21:44.680><c> be</c> um all those premium payments would be um all

Summary: The committee first heard testimony on House Bill 437, which would change New Hampshire law on undischarged mortgages by creating a shorter period after which certain old mortgages would be treated as unenforceable. Prime sponsor Representative Bill Boyd said the bill was developed with input from bankers, lawyers, realtors, the Attorney General’s office, and the Banking Department, and he noted a drafting correction needed on line 18. He explained that the proposal would replace current law with a new framework modeled partly on Massachusetts, including a five-year expiration after a stated maturity date and a 35-year period for mortgages without an expiration date. Supporters said the bill would help clear obsolete title defects, reduce costly quiet-title litigation, and make real estate transactions easier for consumers, attorneys, and conveyancers. Representative Mary Hakken-Phillips, Susan Cole of the New Hampshire Association of Realtors, and Michelle Coffin all testified in support, describing the bill as a consumer protection measure. They said undischarged or improperly discharged mortgages often surface during title searches, causing delays, legal expenses, and failed or delayed closings. Coffin and Hakken-Phillips emphasized that many of these cases involve old, effectively obsolete mortgages and that the current process often requires expensive court action even when no one contests the title. Cole described a recent transaction in which a title defect caused a buyer to walk away and later restart the financing process, creating costs for both buyer and seller. A committee member asked about notice to mortgage holders; the response was that the lender bears responsibility for recording and extending the mortgage, and that due process rights would remain if a lender later contested the discharge. Ryan Hill of the New Hampshire Bankers Association said the banking industry had reviewed the bill and was generally comfortable with it, while requesting a delayed effective date so members would have time to adjust their recording practices. He said the bill’s January 1, 2028 effective date reflected that request. After closing the hearing on HB 437, the committee opened a hearing on House Bill 721, the Gold and Silver Legal Tender Act. Representative Juliet Harvey-Bolia introduced it as a bipartisan economic justice bill intended to recognize gold and silver as legal tender, protect against inflation, and address concerns about trust, taxes, and government taking. She argued that gold is a stable store of value and discussed tax treatment in neighboring states, federal history, and digital gold platforms. The hearing on HB 721 was still in progress when the transcript ended, with the chair limiting questions because of time.

Transcript Highlights:

• Domestic payments can take two to three days. Cross-border payments can take weeks.
• . payment. payment. you<01:21:18.000><c> know,</c><01:21:18.239><c> kind</c><01:21:18.480><c> of,</c>
• And the next line, the rent payments.
• So you can see the mortgage payments plus property expenses equals the same sum as rent payments plus
• So you can see the mortgage payments plus property expenses equals the same sum as rent payments plus

Summary: The meeting began with roll call and approval of the prior meeting minutes, which passed unanimously. Members then introduced the day’s presentations, including one on the Canton network and another on tokenizing real-world assets, with a focus on how blockchain systems can support regulated financial institutions and asset tokenization. Julie, the director of policy and government affairs at Digital Asset, presented on the Canton network, describing it as a privacy-enabled public blockchain designed for regulated finance. She said tokenization should preserve the same legal and economic rights as the underlying asset, and argued that blockchain-based books and records can shorten settlement times, improve 24/7 trading, and reduce friction in capital markets. She identified three main barriers to institutional adoption of public blockchains: lack of privacy, limited throughput/scalability, and lack of control for compliance purposes such as freezing assets, pausing transactions, and meeting AML/sanctions obligations. She explained Canton’s structure as a public, permissionless network with application-level privacy controls, a global synchronizer, and super validators chosen by vote. She also highlighted current ecosystem participants and use cases, including Broadridge, Circle, and the DTCC’s planned tokenization of U.S. Treasuries on the network. Members and online participants asked about the relationship between tokenized assets and the Clarity Act, tokenized deposits, safeguards for faster settlement, and whether the platform could be used for municipal or property records. Julie said Digital Asset was not taking a position on rewards, but supported clearer statutory definitions because tokenized securities should carry the same rights as the underlying assets and investors need to know whether a token is a true tokenized security or a synthetic/reference token. She said the company is agnostic on whether the cash leg is stablecoins or tokenized deposits, though it expects both to develop. In response to concerns about rapid settlement, she pointed to institution-level permissions and SEC disclosure expectations as safeguards. She also said the technology could be used for other records, including potentially property-related records, if those assets can be tokenized.

Transcript Highlights:

• Because for each homeless individual, we could have put a down payment on the median cost of a home in
• This bill will exempt a veteran's military retirement pay, as well as surviving spouse benefit payments
• As of January 31, 2023, about 127,000 military retirees in California received total monthly payments
• Made a large tax payment that was currently a sales tax, but could instead be an ad valorem property
• I think if we have a pot of money from these civil penalties that is then eligible for direct payment

Committee: Senate Revenue and Taxation

Summary: The committee heard several tax and revenue-related bills. SB 1277, by Senator Grove, proposed a California Cost of Living Tax Credit modeled on the 2022 middle-class tax refund to provide direct relief to low- and middle-income Californians facing high housing, fuel, and utility costs. Supporters argued it would help families struggling with affordability, while opponents, including the California Tax Reform Association and CTA members, said California’s tax system already provides relief and that the bill would reduce General Fund revenue and harm schools. After extended debate, the bill was put on call and later failed on a 1-4 vote, though reconsideration was granted. SB 1287, by Senator Retado, would create a performance-based tax credit for short-line rail investments; supporters said it would improve freight efficiency, safety, emissions, and rural access, while opponents preferred direct grants. The bill was placed on call and later passed 5-0 to Transportation. SB 1407, by Senator Archuleta, would exempt military retirement pay and survivor benefits from state taxes; the author, State Treasurer Fiona Ma, and veterans’ groups said it would help retain veterans and their economic contributions in California, while CTA and CTRA opposed on General Fund grounds. The bill passed 5-0 to Military and Veterans Affairs. SB 1349, by Senator Gonzalez, would direct the LAO to review major tax expenditures for effectiveness and impacts on schools and the budget; CTA and CTRA supported it as a way to increase accountability, and it passed 4-1 to Governmental Organization. SB 1120, by Senator McNerney, would extend the California Competes Tax Credit through 2035 and make credits refundable for certain strategic industries; business and industry witnesses said this would help startups and manufacturers monetize credits and attract investment, and it passed 5-0 to Appropriations. SB 1275, also by Senator McNerney, proposed converting the state sales tax on vehicle purchases into a deductible vehicle license fee to reduce Californians’ federal tax burden; the LAO provided technical testimony, and the bill passed 4-0 to Transportation. The committee also heard SB 1078, by Senator Laird, to let Santa Cruz County voters consider a temporary local tax increase for health and safety-net services, but it was put on call. Later, the committee returned to SB 1314, by Senator Min, addressing youth tobacco and illicit smoke shop sales, but the transcript cuts off before final action on that bill.

Transcript Highlights:

• It simply drives it to third-party financing or upfront payment requirements. up-front policies, which
• It simply drives it to third-party financing or upfront payment requirements.
• To third-party financing or up-front payment requirements.
• However, they can also lead providers to raise prices, require upfront payments, or reduce services.
• However, they can also lead providers to raise prices, require upfront payments, or reduce services.

Summary: The committee began with Senate Bill 5962 on spring blade knives, first suspending the five-day notice requirement. Staff explained the bill would remove spring blade knives from the list of dangerous weapons while keeping restrictions on carrying them in schools, child care, and other protected locations. Proponents, including Knife Rights and the prime sponsor Sen. T’wina Nobles, described the measure as a modernization and cleanup bill that would reduce confusion and support lawful use and manufacturing; one testifier strongly objected to the bill’s added location-based restrictions. Public testimony was overwhelmingly in support, and the hearing then moved on without a vote. Senate Bill 6105 would raise the wage exemption from garnishment for medical debt judgments from 30 to 60 times the state minimum wage, while keeping the 80% disposable earnings exemption and adding notice requirements identifying the debt as medical. Sen. Marko Liias said the bill is intended to protect low-wage workers from severe financial hardship and reduce incentives to work off the books. Supporters from patient, consumer, AARP, and anti-poverty groups said medical debt is often unexpected and garnishment can destabilize families; opponents from collectors and trade groups argued the bill was too broad, lacked stakeholder input, could hurt providers, and should define medical debt more clearly. The hearing closed with no action taken. The committee then heard Senate Bill 6203, which would clarify that out-of-state convictions can include foreign-country convictions for offender scoring if obtained with sufficient due process safeguards. The sponsor, Sen. Matt Boehnke, said the bill closes a gap in sentencing law; prosecutors supported the concept and suggested simplifying the language, while the Sentencing Guidelines Commission, defense attorneys, and public defense opposed it, citing undefined standards, difficulty verifying foreign convictions, and due process concerns. The committee also heard Senate Bill 6296 on involuntary treatment, which would expand who may petition for detention, change rules for assisted outpatient treatment and police assistance, require firearm surrender compliance procedures, and make other ITA changes. The sponsor and several providers and family members supported the bill as a needed modernization, while DCRs, disability advocates, behavioral health organizations, hospitals, and others raised concerns about due process, implementation, rural transport, capacity, and unintended consequences. No votes were taken on either bill during the hearing.

Transcript Highlights:

• As a result, patients are held harmless, balance billing is prohibited, and payment disputes occur only
• Therefore, providers are often forced into expensive and prolonged litigation just to obtain payment
• Therefore, providers are often forced into expensive and prolonged litigation just to obtain payment
• It's required payment. You can get it free at the health department. Thank you.
• It's required payment. You can get it free at the health department.

Bills: S1082 , S1168 , S1756 , S1156 , S1480

Committee: Senate Health Policy

Summary: The committee took up several health-related bills. SB 1082, on a statewide provider and health plan claim dispute resolution program, was presented as a way to let providers and insurers use the federal independent dispute resolution process for emergency out-of-network claims under state-regulated commercial plans. A late-filed amendment clarified when providers and health plans could access the state program, and the bill was reported favorably as a committee substitute. SB 1168, which would centralize background screening clearinghouse functions at the Agency for Health Care Administration, also passed as amended after an amendment requiring sealed and expunged records to be included in screenings for qualified entities. Supporters said centralization would improve turnaround times, reduce duplication, and save costs; the sponsor said the bill also addresses coaches’ background screening language from last session. The committee then approved SB 1156, which moves ambulatory surgery center regulation out of the hospital-focused chapter of law into a standalone section, and SB 1480, as amended by a strike-all, which would grandfather certain temporary certificate holders practicing in areas of critical need if federal designation changes affect those areas. Testimony on SB 1480 emphasized continuity of care for patients in underserved communities, and the bill was reported favorably. The final and most heavily debated measure was SB 1756 on medical freedom, which would require state-approved educational materials on childhood vaccines, require practitioners to provide those materials and alternative schedules before vaccination, expand school immunization exemptions to include conscience-based objections, clarify that the Surgeon General cannot order vaccination during a public health emergency, and authorize pharmacists to provide ivermectin behind the counter without a prescription with written information and safeguards. The sponsor argued the bill strengthens parental choice and informed consent. Committee members raised concerns about vaccine-preventable disease risks, immunocompromised children, school outbreaks, and the impact of adding a new exemption. A Department of Health representative said the department would need to provide details on the history of exemption consultations and noted that removing the earlier consultation requirement had not been shown to increase outbreaks. The committee adopted a friendly amendment to give physicians the same liability protection as pharmacists for ivermectin dispensing, but rejected a substitute amendment that would have required a consultation for exemption requests. Public testimony was overwhelmingly opposed to the bill, with physicians, pediatric specialists, cancer advocates, parents of immunocompromised children, and public health groups warning that it would lower vaccination rates and endanger vulnerable Floridians. The bill remained pending after testimony, with the committee continuing to hear public comment.

Transcript Highlights:

• Relevant to this bill, the amount of the employer's monthly payment for health care benefits is included
• This means that they will receive partial payment ranging from 60% to 75% of the cost of those health
• A worker must receive 100% of the employer's monthly payment for health care benefits unless the employer
• A hiring entity includes any person, business, or employer that provides payment to a domestic worker
• And so the worker is notified that their time loss payment would go up.

Summary: The House Labor and Workplace Standards Committee heard public testimony on several bills. HB 2151 would update factory-built housing and commercial structure rules by directing L&I to consider newer national standards and allowing inspections by qualified third-party agencies without requiring a contract; the sponsor and L&I said it would save time and money and help lower costs for manufactured housing. HB 2372 would change workers’ compensation time-loss calculations so injured workers receive 100% of the employer’s monthly health care contribution unless the employer keeps paying it; supporters said this would better protect injured workers and their families, while a small-business representative opposed the bill and suggested direct payment to insurers instead, and L&I noted implementation costs and timing concerns. HB 2355, the Domestic Workers Bill of Rights, would create standalone protections for domestic workers covering wages, written agreements, notice before termination or severance, anti-harassment and anti-retaliation rules, and discrimination protections, while also extending minimum wage/overtime/sick leave coverage to some domestic workers; testimony from workers, advocates, Seattle officials, and the sponsor emphasized wage theft, insecurity, and the need for statewide standards, while L&I said technical clarifications and funding would be needed. HB 2409 would establish a collective bargaining framework for agricultural workers under PERC, with procedures for representation elections, mediation, and interest arbitration; supporters framed it as a long-overdue extension of bargaining rights and dignity to farmworkers, while growers and farm bureau representatives warned it could disrupt harvests, harm farms, and affect the food supply. HB 2472 would strengthen enforcement of fire sprinkler licensing and certification by allowing local fire code officials to request proof of credentials and issue stop-work orders; labor, fire marshals, and industry groups supported it as a public safety measure, while the building industry raised a drafting concern about the term “residential sprinkler.” No votes or final committee actions were taken in the hearing.

Transcript Highlights:

• The both Recommendations fully fund the agency's request for benefits payments.
• One would provide 13th check payments so a temporary 2% payment to our retirees.
• A 70 million Appropriation to provide a 2% non-compounding payment. What's that about?
• This last year was 0.63, so this would be a 2 A one-time payment of their annual benefit that we would
• SHARE considers the project closed when the final payment has been made. and the PO is closed.

Committee: House House Appropriations & Finance

Transcript Highlights:

• And on net, we received a negative 10 million in quarterly payments because of that behavior shift.
• Monthly auctions in the second half of 2025 also yielded record bonus payments.
• Those are the upfront one-time payments that a company pays the land office for these leases when they
• And then we have some upward revisions in interest Or investment payments, I'll get into that.
• If HR 1 provides them tax cuts overall, and their liability and their estimated payments Are.

Committee: Joint Revenue Stabilization & Tax Policy Committee

Transcript Highlights:

• That's what, you know, I told you earlier, again, are based on our payment error rate.
• Payment error rate changing from 50-50 state federal funding to then 75-25, and that starts in fiscal
• Payment error rate.
• I just really started looking at data on what causes our payment error rate.
• So, if you have a payment error rate for SNAP that's below 6%, that's one bracketed area.

Committee: House Legislative Health & Human Services Committee

Transcript Highlights:

• The bill also makes it a crime for building contractors who have already received payment.
• Many people have been affected by this, not receiving payment back from procedures that they had.
• These payments often involve a third-party processor that charges a convenience fee for its services.
• Instead, they threaten to eliminate the very payment options that consumers prefer, the options that
• These payments often involve a third-party processor that charges a convenience fee for its services.

Transcript Highlights:

• Then on page eight, H.R. 1 imposes a share of benefit costs in CalFresh, depending on the state's payment
• Eliminating this type of error could reduce our payment error rate significantly.
• And third, automation of a payment verification system match, which provides income information from
• This information will help inform further investments to reduce our payment error rate.
• It'll increase the... ...increase the acuity, it'll lead to higher acuity with no payments.

Summary: The Senate Budget and Fiscal Review Subcommittee held an oversight hearing on the impacts of H.R. 1 on California’s safety net, focusing on Medi-Cal and CalFresh. The chair and vice chair framed the issue as a major federal disruption that would reduce benefits and shift costs to the state, counties, hospitals, and other local systems. The first panel included the Legislative Analyst’s Office, the Department of Finance, the UC Berkeley Labor Center, and the Food Research and Action Center, each describing projected enrollment losses, higher state and county costs, and implementation challenges. The LAO outlined H.R. 1’s main changes: new and expanded work requirements, more frequent eligibility redeterminations, restrictions on certain non-citizen eligibility, and financing changes affecting provider taxes and federal matching rates. The LAO estimated that 1 to 2 million people could be disenrolled from Medi-Cal and more than 600,000 could lose CalFresh, with additional costs from reduced federal support and possible state and county administrative burdens. The Department of Finance said the Governor’s budget includes about $1.4 billion General Fund in 2026-27 to respond to H.R. 1, with larger out-year reductions in federal funds and projected Medi-Cal caseload losses of up to 2 million by 2029-30. The UC Berkeley Labor Center projected up to 3 million Californians could lose full-scope Medi-Cal by 2028 when H.R. 1 is combined with state budget changes, while noting the state could choose policies that would reduce some of those losses. The Food Research and Action Center warned that CalFresh cuts and time limits would increase hunger, worsen health outcomes, and strain local economies and emergency systems. Members questioned the witnesses about procedural disenrollments, regional variation, the overall growth in Medi-Cal spending, the future of the MCO tax, the CalFresh error rate, and the downstream effects on hospitals and county indigent care. Several senators argued that the federal law was driven by tax cuts for high-income earners and would disproportionately harm low-income Californians, immigrants, and communities of color. Administration witnesses said some impacts are still being analyzed, that counties and departments are working on implementation, and that the Legislature may need to use statute, reporting, and oversight tools as federal guidance develops. No votes or formal actions were taken during this portion of the hearing.

Transcript Highlights:

• </c><00:10:07.120><c> look</c><00:10:07.360><c> like</c><00:10:07.519><c> they've</c> benefit payments
• look like they've benefit payments look like they've declined<00:10:08.560><c> uh</c><00:10:08.920><
• If you back those refunds out, there's a slight increase in benefit payments, which is kind of expected
• payments represented here.
• So for the 2025 period, we have almost $1.7 billion in outflows from benefit payments and refunds for

Summary: The meeting opened with the Pledge of Allegiance and prayer, followed by a roll call confirming a quorum and approval of the prior minutes. A special guest, Dave Eager, was welcomed before the committee moved to presentations from retirement system officials. Bo Craycraft, executive director of the Judicial Form Retirement System, gave a quarterly update on investment performance, asset allocation, and cash flow. He said the plans had held up well amid market volatility, with fiscal year-to-date returns above benchmark and long-term returns remaining strong. He explained that the plans are targeted to a 70% equity/30% fixed-income allocation, that some cash is being held for cash-flow management, and that negative cash flow is expected because of funding and contribution levels. He also said Senate Bill 183, dealing with proxy voting and economic analysis for certain votes, was not expected to materially affect the plans because of their small number of holdings and Bear Trust’s long-term investment approach. Ryan Barrow and Erin Surrod then presented for the Kentucky Pension Authority. They reported positive quarterly performance across the retirement and insurance funds, though results varied by period and remained tied to broader market conditions. They said recent asset-allocation changes had been completed and the funds were now within target ranges. On cash flow, they noted some plans remained negative or near zero, with one plan benefiting from a large appropriation. In the legislative update, they described House Bill 30 as codifying an exclusion from pension-spiking calculations for across-the-board raises, and Senate Bill 10 as increasing retiree health insurance subsidies and changing employee health insurance contribution rules for certain CERS members beginning in 2026. They also said Senate Bill 183 would likely have limited impact, though the agency would review voting policies and incorporate any required economic-analysis procedures.

Transcript Highlights:

• It caps survivor payments at $5 million annually.
• It creates the mechanism... ...cap survivor payments at $5 million annually.
• amendments does the following: It gives LDH more flexibility as to the timing of making the directed payments
• It gives L.D.H. more flexibility as to the timing of making the directed payments.

Bills: HB1 , HB2 , HB3 , HB312 , HB313 , HB314 , HB383 , HB983 , HB1126 , HCR3

Committee: Senate Finance

Keywords: bond authorization, capital improvement, general obligation bonds, financial management, state treasury, revenue sharing, fund distribution, homestead exemption, state funding, local government

Transcript Highlights:

• It also clarifies that certain payments to local law enforcement are treated as a reimbursement, not
• It also clarifies<00:04:04.280><c> that</c><00:04:04.440><c> certain</c><00:04:04.720><c> payments</c
• ><00:04:05.120><c> to</c><00:04:05.240><c> local</c> clarifies that certain payments to local clarifies
• that certain payments to local law<00:04:05.680><c> enforcement</c><00:04:06.360><c> is</c><00:04:06.520