Bills: SCR29 , HB7380 , HB5200 , HB1681 , SB98 , HB5201 , HR1343 , HB7022 , HB7386

Keywords: internet freedom, Iran, cybersecurity, VPN, DTC technology, information access, human rights, digital tools, Emergency Reporting Act, FCC, Federal Communications Commission, Disaster Information Reporting System, DIRS, network outage reporting, outage notifications, 9-1-1, public safety answering point, PSAP, emergency communications center, broadband

Transcript Highlights:

• As you know, DIR is currently undergoing sunset review.
• It keeps DIR in place.
• DIR was chartered in 1989 to procure technology at scale.
• I've worked with DIR very closely for a long time.
• DIR purchasing and Cyber Command as a division of DIR and housing it under the chain of command of state

Bills: HB146 , HB150 , HB1500 , HB1545 , HB1562 , HB2067 , HB2520 , HB2818 , HB3214 , HB3250 , HB3466 , HB3512 , HB3623 , HB4063 , HB4395 , HB4464 , HB4668 , HB4690 , HB5331 , HB3833 , HB146 , HB150

Committee: Senate Business & Commerce

Summary: The committee took up several pending business items and reported a series of House bills out of committee, including HB 2467, HB 2468, HB 2518, HB 4310, HB 4386, HB 4490, HB 5323, and HB 149. Most of these were advanced on committee substitute motions and sent to the local and uncontested calendar or reported favorably to the full Senate. HB 2467 drew one nay vote, while the others were approved without opposition. HB 4310 and HB 4386 were described as committee-substitute versions with changes narrowing disclosure requirements and preserving attorney-client privilege in certain circumstances. A major portion of the meeting focused on HB 149, an AI governance bill. The substitute was explained as addressing biometric identifier capture and storage, exempting certain AI uses for security and fraud prevention, clarifying definitions, restricting AI systems that simulate explicit child sexual content, adjusting Attorney General investigative authority, refining sandbox program waivers, reducing Texas AI Council powers and membership, and adding DIR coordination provisions. The committee adopted the substitute and reported the bill favorably. The committee then heard extensive testimony on HB 1500, the DIR sunset bill. The author said the bill would continue DIR for 12 years, restructure its board, update advisory committees, require regular cybersecurity assessments and penetration testing for state agencies, improve IT procurement training, and transfer the e-grants program to the Comptroller. A Texas 2036 witness supported the bill as a way to strengthen governance, procurement, and cybersecurity. Members asked detailed questions about the bill’s structure and then left HB 1500 pending. The committee also heard a lengthy presentation on HB 150, which would create the Texas Cyber Command as a component of the University of Texas System, administratively attached to UTSA and located in San Antonio. The author argued the command would centralize cyber threat intelligence, incident response, and digital forensics, and would be able to support state and local entities, with optional services for local governments. Members raised concerns about university mission drift, governance, security, chain of command, procurement authority, gifts and donations, and civil liberties implications of proactive cyber monitoring. Witnesses from UTSA/NSCC and SecurityScorecard testified in support, emphasizing the security of the downtown San Antonio facility, the existing cyber ecosystem there, and the need for a dedicated cyber capability. The bill remained under discussion with no final committee action announced in the excerpt.

Transcript Highlights:

• To deliver on this mission, DIR is made up of four key divisions.
• Yes, DIR definitely does utilize the temporary help.
• Josh Iverson, Chief Financial Officer at DIR.
• Grace Henry, Department of Finance, just echoing the comments from DIR.
• Good afternoon, Josh Iverson, Chief Fiscal Officer, DIR.

Summary: The subcommittee heard a series of budget and trailer bill presentations focused on labor and public employment programs. The first item covered EDD Next modernization, where EDD described progress on customer service improvements, fraud prevention, language access, and the Integrated Claims Management System. The LAO urged stronger legislative oversight as the project enters its most difficult phase, and members questioned the revised schedule, total cost, change orders, stress testing, SB 1090 implementation, and how race and ethnicity data will be protected. EDD said the overall project cost remains about $1.2 billion, that the work is being phased with disability insurance and paid family leave first, and that fraud has been greatly reduced since pandemic-era programs ended. Members also asked for follow-up information on SB 590 outreach and equity impacts. The committee then reviewed the California Workforce Development Board’s request to reduce staffing as one-time grant workloads wind down, along with trailer bill language to streamline reporting requirements. The board and Department of Finance said the staffing reductions reflect the end of surge funding and that the proposal would consolidate roughly 10 to 12 reports into one annual report, with additional reporting only if new funds are appropriated for certain programs. Senator Durazo questioned the policy direction of reducing workforce staffing, while the administration said the positions were tied to temporary grant programs and that current staffing is sufficient for ongoing duties. Members also asked about the board’s role in AI-related workforce planning and the rationale for using state funds for the High Road Construction Careers Program. A major portion of the hearing focused on the Subsequent Injury Benefits Trust Fund reforms and related staffing request at DIR. The administration and LAO described rapid growth in applications, backlog, and liabilities, saying the program’s eligibility has expanded beyond its original intent and that liabilities could reach about $30 billion by 2030 without reform. The trailer bill would tighten eligibility, apply the changes to open cases, and use the QME process and contemporaneous evidence to document preexisting disabilities. Members raised concerns about fairness to pending claimants, evaluator capacity, and the relationship to other SIBTF legislation, while the LAO said the proposal largely aligns with its prior recommendations. DIR also presented a request to eliminate vacant positions under a statewide vacancy sweep, which drew criticism from members who argued the cuts could weaken enforcement and backlog reduction efforts; the committee asked DIR to return with more detail on impacts and on its use of temporary-help authority. The final items addressed a request for additional Cal/OSHA investigative staff and a trailer bill to make permanent the revised Workers’ Compensation Appeals Board petition timeline. DIR said the BOI staffing would help investigate fatalities and serious injuries more quickly, while members emphasized the importance of family contact and timely investigations. For the WCAB item, the chair explained that the 2024 change to Labor Code section 5909, which starts the 60-day decision clock when a case is transmitted rather than when a petition is filed, has reduced pending cases and should be made permanent; the remaining backlog was reported at 460 cases, down from 637 before the change.

Transcript Highlights:

• Ken Lau, Chief Counsel, DIR.
• Hello again, Josh Iverson, Chief Financial Officer at DIR.
• Yes, DIR definitely does utilize the temporary help.
• Josh Iverson, Chief Financial Officer at DIR.
• Good afternoon, Josh Iverson, Chief Fiscal Officer, DIR.

Summary: The Senate Budget Subcommittee on Corrections, Public Safety, Judiciary, Labor, and Transportation heard presentations on labor and public employment issues from the Employment Development Department (EDD), the California Workforce Development Board (CWDB), and the Department of Industrial Relations (DIR). The committee first focused on EDD Next modernization, where EDD described progress on online claims, call center upgrades, language access, fraud prevention, and the Integrated Claims Management System (ICMS). The Legislative Analyst’s Office urged closer legislative oversight, especially as the project moves into the most difficult phase. Senators asked about the revised timeline, total cost, fraud reduction, stress testing, transparency around change orders, and the decision to phase in disability insurance and paid family leave before unemployment insurance. EDD said the overall project cost remained about $1.2 billion, that it had no major cost overruns, and that it had saved more than $20 million by shifting some shared customer portal work into ICMS. The subcommittee then considered CWDB’s request for additional operational resources and trailer bill language to streamline reporting. CWDB and the Department of Finance said staffing had been expanded during the pandemic-era surge in grant funding and should now be reduced as one-time grant programs wind down. Senators questioned the proposed staffing reduction, arguing that workforce development needs remain strong and that the board’s policy role still requires adequate capacity. The committee also discussed a proposal to consolidate multiple annual and interim reports into a single biennial report, with LAO supporting the streamlining. Members asked about reporting for specific programs and the cost savings from reducing duplicative evaluations. A major portion of the hearing addressed DIR’s proposed reforms to the Subsequent Injury Benefits Trust Fund (SIBTF) and related workload funding. DIR and LAO described rapid growth in applications, a large and growing backlog, and sharply rising liabilities and employer assessments. The administration’s trailer bill would tighten eligibility, apply reforms to open cases, and use contemporaneous evidence and QME reports to document preexisting disabilities. LAO said the proposal largely matched its prior recommendations and would help return the program to its original intent. Senators raised concerns about fairness to pending claimants, the effect on workers with undocumented preexisting conditions, and whether the QME system could absorb the added workload. The committee also heard DIR’s request to eliminate vacant positions under a statewide vacancy sweep, with members objecting that some vacancies reflect unmet enforcement and safety needs rather than excess capacity. The hearing continued with DIR proposals for additional Cal/OSHA investigative staff, permanent changes to Workers’ Compensation Appeals Board petition deadlines, and apprenticeship-related funding increases. DIR sought 14 permanent positions for its Bureau of Investigation to handle serious workplace fatalities and injuries, and members emphasized the importance of timely investigations and family communication. The WCAB requested making permanent a 2024 change that starts the 60-day reconsideration clock when a case is transmitted rather than when the petition is filed; the board said this had reduced the number of cases awaiting decisions from 637 to 460. Finally, DIR proposed increasing apprenticeship training grants from $3 million to $20 million annually using the Apprenticeship Training Contribution Fund, citing an $80 million fund balance and workforce demand tied to rebuilding and infrastructure needs, and then began discussion of a separate request to expand pre-apprenticeship programs.

Transcript Highlights:

• To deliver on this mission, DIR is made up of four key divisions.
• Last fiscal year, DIR received over 5,000 applications, a six-fold increase.
• Ken Lau, Chief Counsel, DIR.
• Grace Henry, Department of Finance, just echoing the comments from DIR.
• Good afternoon, Josh Iverson, Chief Fiscal Officer, DIR.

Transcript Highlights:

• I was told that they were under the DIR and a new department under the DIR, so I apologize for that.
• And so it is better now that it's brought under the DIR.
• And so it is better now that it's brought under the DIR.
• And so it was better now that it's brought under the DIR.
• And so it is better now that it's brought under the DIR.

Committee: Senate Rules

Summary: The Senate Rules Committee approved several non-appearing gubernatorial appointments and routine agenda items by 4-0 votes, including Frank Damrow Jr. to the Alcoholic Beverage Control Appeals Board, Michelle Eddger to the Board of Barbering and Cosmetology, and David Galavis to the State Park and Recreation Commission. The committee also approved bill referrals, a rule waiver to allow SB 1447 to be heard after the policy deadline, and floor acknowledgments. The committee then heard the appointment of Clint Kellam as Director of the Department of Cannabis Control. Members focused heavily on cannabis regulation, especially illicit market activity, consumer education, labeling, and youth protection. Kellam said the department’s goal is to shift consumption from illicit to legal sources, not increase use, and described efforts such as the Real California Cannabis website, the required educational pamphlet for new users, inspections, and package review. Senators raised concerns about attractive-to-children packaging, high-dose beverages, and the need for tighter labeling rules; Kellam said the department is open to legislative changes, is working on an AI tool to help licensees review packaging, and uses recalls, citations, and administrative actions when products violate rules. He also described enforcement efforts against illegal cultivation and retail, including the Unified Cannabis Enforcement Task Force and cooperation with local, state, and federal agencies. The committee voted 4-0 to advance the appointment. The committee next heard Jennifer Osborne’s appointment as Director of the Department of Industrial Relations. Osborne described her background in state administration and said she aims to remove barriers, improve systems, and support workplace safety, wage enforcement, workers’ compensation, and apprenticeship programs. Senators asked about PAGA enforcement, Cal/OSHA audit findings, backlogs, staffing shortages, and complaint handling. Osborne said DIR’s role in PAGA is limited, but the department is working on Cal/OSHA policy revisions, training, additional investigation staff, centralized intake, IT modernization, and possible use of outside administrative law judges to reduce delays. She also said the department is addressing vacancy and backlog issues through classification changes and new hiring strategies. Public commenters from employer groups and labor organizations spoke in support, and the committee approved the appointment 4-0 for full Senate confirmation.

Transcript Highlights:

• So they're not under the DIR. I apologize. No, I apologize.
• I was told that they were under the DIR and a new department under the DIR.
• And so it is better now that it's brought under the DIR.
• And so it is better now that it's brought under the DIR.
• But, I mean, DIR is, you know, smaller. It's a smaller scale.

Committee: Senate Rules

Summary: The Senate Rules Committee approved several governor’s appointments not required to appear, including Frank Damrow Jr. to the Alcoholic Beverage Control Appeals Board, Michelle Eddger to the Board of Barbering and Cosmetology, and David Galavis to the State Park and Recreation Commission, each by 4-0 vote. The committee also approved a rule waiver to allow SB 1447 (health) to be heard after the policy committee deadline, and took up floor acknowledgments before moving to appointments requiring testimony. The committee then heard from Clint Kellam, nominee to lead the Department of Cannabis Control. Members focused heavily on cannabis labeling, youth protection, attractive-to-children packaging, the SB 540 educational pamphlet, and the department’s efforts to steer consumers from illicit to legal products. Kellam said the department’s role is not to promote increased consumption but to move existing consumption into the regulated market, and he described enforcement against illicit cultivation and retail, consumer education efforts, and a possible AI tool to help licensees review packaging. He also said the department would consider tighter packaging rules, including one-serving packaging, but emphasized the need for research and legislative collaboration. The committee voted 4-0 to advance his appointment to the full Senate. The committee next heard from Jennifer Osborne, nominee to direct the Department of Industrial Relations. Questions centered on DIR’s handling of Cal/OSHA audit findings, labor commissioner backlogs, PAGA enforcement, staffing shortages, IT modernization, and how her administrative background would help address those issues. Osborne said DIR is working on revised Cal/OSHA policies and procedures, additional staffing and intake changes, new IT systems, and possible use of outside administrative law judges to reduce delays. She also clarified that the Civil Rights Department is not under DIR, but said she would follow up on concerns raised. Public commenters from employer groups, labor, and industry largely supported her nomination, and the committee approved her appointment 4-0 to move to the full Senate for confirmation.

Transcript Highlights:

• So they're not under the DIR. I apologize. No, I apologize.
• I was told that they were under the DIR and a new department under the DIR.
• And so it is better now that it's brought under the DIR.
• And so it is better now that it's brought under the DIR.
• For input and information on that, as well as folks outside of DIR.

Summary: The Senate Rules Committee met to consider several gubernatorial appointments and procedural items. It unanimously approved three appointments not required to appear: Frank Damrow Jr. to the Alcoholic Beverage Control Appeals Board, Michelle Edger to the Board of Barbering and Cosmetology, and David Galavis to the State Park and Recreation Commission. The committee also approved bill referrals, a rule waiver to allow SB 1447 (Health) to be heard past the policy deadline, and floor acknowledgments, all by 4-0 votes. The committee then heard testimony from Clint Kellam, nominee to lead the Department of Cannabis Control. Senators focused on illicit cannabis activity, consumer education, youth protection, labeling, and packaging that may be attractive to children. Kellam said the department’s goal is to shift consumption from illicit to legal sources, not increase use, and described efforts including the Real California Cannabis campaign, the SB 540 pamphlet, inspections, a package-review team, and an AI image analyzer for licensees. He also discussed enforcement against illicit cultivation, coordination with local, state, and federal agencies, and the department’s role in helping bring legal market compliance and access into balance. The committee voted 4-0 to advance his appointment to the full Senate. The committee next heard from Jennifer Osborne, nominee to direct the Department of Industrial Relations. Questions centered on Cal/OSHA audit findings, workplace safety, PAGA-related litigation, case backlogs, staffing shortages, and how her administrative background would help manage the department. Osborne said she would focus on fixing systemic issues, improving staffing and classification rules, modernizing IT systems, adding intake and investigative capacity, and addressing the Cal/OSHA audit recommendations. She also said DIR would continue working on worker safety, compensation, and apprenticeship programs, and would follow up on some questions about natural-disaster-related enforcement and backlog metrics. Public commenters from employer groups and labor organizations spoke in support, and the committee approved her appointment 4-0 for consideration by the full Senate.

Transcript Highlights:

• I'm excited to be leading DIR at this moment in time.
• So how many vacancies currently exist within the DIR?
• For the DIR? Yes. I have a 28%... For the DIR? Yes. I have a 28 percent.
• Thanks to DIR, Finance, and LEO for your analysis on this really complicated issue.
• Michelle Yun, Deputy Director of the Office of External Affairs within DIR.

Summary: The Budget Subcommittee on State Administration heard presentations on the Department of Industrial Relations’ labor-related budget items, with the main focus on proposed trailer bill language to reform the Subsequent Injury Benefits Trust Fund (SIBTF) and a related budget change proposal for staffing. DIR said SIBTF has grown far beyond its original purpose, citing the 2020 Todd decision, expanded eligibility based on chronic or asymptomatic conditions, and a backlog that has grown to more than 30,000 pending cases. The administration argued the reforms would restore guardrails, reduce liabilities and employer assessments, and speed processing for severely injured workers; the LAO said the proposal was largely consistent with its prior recommendations. Members raised concerns about using trailer bill language for major policy changes, the retroactive application to open cases, and the impact on workers already in the queue, while supporters from employer groups and public agencies backed the proposal as necessary to control costs and restore sustainability. Public comment was split, with injured-worker advocates opposing the retroactive changes and business/public employer representatives supporting the reforms. The committee then heard the SIBTF workload request, which would phase in 177 positions over five years at a cost of $36.5 million, including staff for the Division of Workers’ Compensation, the Office of the Director Legal Unit, and administrative support. DIR said the additional staffing is intended to address very high caseloads and reduce processing times, but emphasized that the request assumes the reform package is adopted; LAO agreed the staffing increase made sense if paired with reforms. Members asked about vacancy rates, current staffing, and whether the workload request would become the new normal, and DIR said it would monitor caseload trends and adjust future requests as needed. Finally, the committee received an update on the California Workplace Outreach Program (CWOP), which DIR described as a partnership with community-based organizations to educate workers and help employers comply with labor laws. DIR reported that CWOP has reached 1.75 million workers and employers and made 8 million touchpoints since 2020, with the current round awarding $50.7 million to 87 partners for a two-year period through June 2027. Members and public commenters highlighted the program’s role in reaching immigrant, farmworker, janitorial, nail salon, and other vulnerable communities, and several speakers urged continued funding at $30 million per year for five years. No votes were taken during the hearing.

Transcript Highlights:

• I'll note two of the items are for ongoing IT projects at DIR.
• The DIR is the number one department for unfilled vacancies at 31% with unfilled positions.
• So my question is for the DIR: If you need more money, why are we collecting the fines?
• So my colleague had referenced that there's the 31% vacancy rate in DIR. Is that accurate?
• DIR has a number of strategic initiatives underway, several of them resulting from the audits.

Transcript Highlights:

• I'll note two of the items are for ongoing IT projects at DIR.
• So my question is for the DIR: If you need more money, why are we collecting the fines?
• That proposed... ...at DIR who help adjudicate settlements and hearings for wage claims.
• So my colleague had referenced that there's the 31% vacancy rate in DIR. Is that accurate?
• DIR has a number of strategic initiatives underway, several of them resulting from the audits.

Summary: The Assembly Budget Subcommittee 5 on State Administration held a May Revise hearing focused on state administration proposals, with the chair noting no actions would be taken and all items would remain open. The committee heard presentations on a range of budget proposals, including technical adjustments for the Governor’s Office of Service and Community Engagement and the California Workforce Development Board, security and election-related funding for the Secretary of State, modernization and loan-backfill requests for the Department of Consumer Affairs, and multiple Employment Development Department updates covering EDD Next, UI and DI/PFL benefit estimates, workforce funding, and an EMT training reappropriation. Several items drew discussion from the LAO and committee members. The LAO generally supported technical or modernization items such as PERB’s implementation requests, GoServe’s College Corps adjustment, the Secretary of State’s security and HAVA grant items, and the Board of Pharmacy modernization proposal, but raised concerns about the Bureau for Private Postsecondary Education’s proposed $10 million General Fund backfill and interest-free loan language. For EDD, the LAO flagged the size of the DI/PFL benefit adjustment and the unusual structure of the document management system proposal within EDD Next, while EDD said the changes reflected higher participation and benefit levels after SB 951 and ongoing modernization needs. The Department of Industrial Relations drew the most extensive questioning. It proposed funding for legal unit reclassifications, EAMS and Cal/OSHA data modernization, a new Cal/OSHA emerging technologies unit, a COYA reappropriation, and trailer bill changes requiring electronic payment of employer assessments and adjusting the Workers’ Compensation Appeals Board timeline. Members pressed DIR on high vacancy rates, long wage theft and workers’ compensation backlogs, low collection rates for fines, and the need for clearer workload and outcome measures. DIR said the requests were intended to improve efficiency, support audits and corrective action plans, and better address emerging workplace risks, while the LAO said the workload drivers behind delays remain unclear. The hearing also included support for CalHR’s employee assistance program consolidation and CDT’s proposal to expand “Poppy,” a statewide generative AI assistant for state employees.

Transcript Highlights:

• With that, we are going to go ahead and call up the new director for DIR, Jennifer Osborne.
• I'm excited to be leading DIR at this moment in time.
• So how many vacancies currently exist within the DIR?
• For the DIR? Yes. I have a 28 percent.
• Thanks to DIR, Finance, and LEO for your analysis on this really complicated issue.

Transcript Highlights:

• However, we at DIR do receive also complaints from both employers and employees.
• So they're not under the DIR. I apologize. No, I apologize.
• I was told that they were under the DIR and a new department under the DIR.
• And so it was, it is better now that it's brought under the DIR.
• And so it was, it is better now that it's brought under the DIR.

Committee: Senate Rules

Transcript Highlights:

• In addition, DIR is seeking budget authority to implement additional IT In addition, DIR is seeking budget
• So a few things that we've been working on at DIR for that.
• I'm the Chief Financial Officer at DIR.
• Is that something DIR is... ...this agency, this institute?
• DIR with the necessary tools to carry out this role.

Bills: SB 1 , SB 1

Committee: Senate Finance

Summary: The committee began with Article I budget items for the Secretary of State. LBB staff outlined recommendations that would reduce the agency’s appropriation by about $40.3 million, including changes to HAVA funding, removal of one-time business system replacement money, and a rider directing the agency to use Fund 5095 first. Secretary Jane Nelson and staff then defended several exceptional items, especially additional staffing for elections and business filings, a new website, digitization of records, cybersecurity tools, and renovation of the James Earl Rudder Building. Members focused heavily on election administration, cross-checking voter rolls, Harris County complaints, call-center response times, and whether online voter registration should be expanded. No votes were taken; the discussion was informational and budget-focused. The committee then heard the Office of the Governor and trustee programs. LBB presented a recommended $2.4 million decrease for the governor’s office proper and a much larger decrease in trustee programs driven by one-time funding and unexpended balances, while still preserving major border security funding and victim assistance funding. Governor’s staff emphasized Texas’ economic growth, the importance of border security, and efforts to seek federal reimbursement for the roughly $11 billion Texas has spent on border operations. Members discussed whether shifting National Guard deployment to federal control could reduce state costs, and they also reviewed the music incubator program, the Governor’s University Research Initiative, and the semiconductor innovation consortium. Staff highlighted a $5 million late-added request for grants to protect nonprofits from violence and terrorism. Again, the exchange was largely explanatory, with no formal action. Finally, the committee took up the Texas Facilities Commission and lease payments for revenue bonds. LBB recommended major reductions overall, including removal of border wall construction funding and capital complex bond funding, but added money for higher utility costs, renovation of the Rudder Building, and additional facilities staff. George Purcell also noted stable maintenance-and-renewal funding and new riders related to the Texas State Library and Archives Commission building, tenant communications, and space utilization. For lease payments, LBB recommended a smaller appropriation tied to revenue-bond costs allocated across agencies. The discussion was informational, with members asking about the Rudder Building renovation, border wall progress, and capital complex construction timelines; no votes were recorded.

Transcript Highlights:

• resources office, within DIR.
• And we welcome an opportunity to work with DIR, CalHR.
• The DIR has routinely withheld those organization charts.
• So we really encourage the Legislature to pass AB 694 and DIR, most importantly DIR, to partner with
• So we really encourage the legislature to really pass AB694 and DIR and most importantly DIR to partner

Summary: The hearing focused on a state audit of Cal/OSHA titled “The Division of Occupational Safety and Health: Process Deficiencies and Staffing Shortages Limit Its Ability to Protect Workers.” Committee leaders and the audit team described serious workplace tragedies, argued that California’s worker protections are not being adequately enforced, and said the audit was prompted by concerns that Cal/OSHA was too often relying on letters instead of inspections, delaying investigations, and closing cases without enough documentation. Members repeatedly emphasized that the issue was not just staffing, but also outdated policies, weak oversight, and inconsistent enforcement. State Auditor Grant Parks said the audit found a 32% vacancy rate in 2023-24, heavy reliance on hard-copy files, outdated or unclear policies, and inconsistent decision-making in complaints, accidents, citations, and fine reductions. He said Cal/OSHA conducted on-site inspections in only about 20% of complaints, used letter investigations more than 80% of the time, often lacked evidence that hazards were corrected, and sometimes failed to inspect serious injury cases on time. The audit also found weak documentation for fine calculations and settlement reductions, with some penalties reduced substantially without clear explanations. Parks said the agency had accepted the findings and would provide progress updates later in the year. Committee members pressed the auditor on vacancy rates, the use of letter investigations, the low rate of criminal referrals, and whether fines were being reduced too often. Cal/OSHA and DIR officials responded that the vacancy rate had fallen to 12% partly because 66 vacant positions were eliminated in a statewide budget reduction and partly because of hiring; they said 126 people had been hired in the first half of the year. They also said they had hired a policy writer, were updating several policies, were planning periodic internal audits, and were developing a new data management system expected to go live in late 2026 or early 2027. On fines, officials said Title 8 sets base penalties and allows adjustments based on factors like employer size, history, and good faith, with appeals and informal conferences also affecting final amounts. No votes or formal actions were taken during the hearing.

Transcript Highlights:

• **Charlie Smith**: To procure staff augmentation contracts through DIR.
• This cycle, DIR is under the Sunset Advisory Commission's review.
• This cycle, DIR is under the Sunset Advisory Commission's review.
• The public entities that DIR serves are using our... Government customers.
• Does anyone have further questions for **DIR**?

Bills: SB1 , SB 1

Committee: Senate Finance

Transcript Highlights:

• Would that be something y'all are required to go through DIR for or will you be going through DIR?
• DIR agency revenue.
• Do you work with the DIR on that? We do.
• That contract was through DIR.
• You know, DIR is DIR with the state of Texas. There are others that are. state.

Committee: House Delivery of Government Efficiency

Transcript Highlights:

• I want to go to DIR. What services is you are providing to your agency?
• When we go out and we request the penetration services from DIR, we have to go.
• One on the DIR conversation.
• We are keeping DIR.
• If it fails, the agencies that get caught are agencies that chose not to use DIR. services.

Bills: SB1 , SB 1

Committee: Senate Finance

Transcript Highlights:

• resources office, within DIR.
• And I oversee the Personnel Office, Human Resources Office, within DIR.
• And we welcome an opportunity to work with DIR, CalHR.
• The DIR has routinely withheld those organization charts.
• So we really encourage the Legislature to pass AB 694 and DIR, and most importantly DIR, to partner with

Summary: The hearing focused on a state audit of Cal/OSHA titled “The Division of Occupational Safety and Health: Process Deficiencies and Staffing Shortages Limit Its Ability to Protect Workers.” Committee leaders and members described the audit as a response to serious workplace tragedies and argued that California’s strong worker protections are undermined when enforcement is inconsistent. Chair Ortega and others emphasized that the issue is not only staffing, but also structural problems in how complaints, inspections, citations, and penalties are handled. State Auditor Grant Parks testified that the audit found major weaknesses in Cal/OSHA’s operations during a five-year review period, including a 32% vacancy rate in 2023-24, heavy reliance on employer self-investigation letters for complaints, late inspections, incomplete case files, outdated policies, and weak documentation for fine calculations and reductions. He said Cal/OSHA often lacked evidence to justify why it did not inspect certain complaints or why it reduced penalties, and that many files did not show proof that employers corrected hazards. He also noted that criminal referrals were rare and that the agency’s paper-based system made oversight difficult. Cal/OSHA and the Department of Industrial Relations responded that they accept the audit’s findings and are already taking corrective steps. Director Jennifer Osborne and Chief Deborah Lee said the division has hired more staff, reduced vacancies to about 12% through recruitment and position eliminations, hired a policy writer, updated or is updating several policies, and is developing a new data management system expected to go live in late 2026 or early 2027. They said serious hazards will be directed to on-site inspections, letter investigations will be limited to non-serious complaints, and internal audits and training will be used to improve consistency and accountability. Members pressed the department on whether these changes will be enough, how fines are set and reduced, and whether the agency is doing enough to protect workers and hold employers accountable.

Transcript Highlights:

• It requires DIR, the Department of Industrial Relations, to partner with state worker unions to develop
• It requires DIR, the Department of Industrial Relations, to partner with state worker unions to develop
• This bill builds on this model by requiring DIR to work through collective bargaining and joint apprenticeship
• believe that this bill is a step in the right direction to help address that problem, especially since DIR
• believe that this bill is in a step in the right direction to help address that problem, especially since DIR

Committee: House Public Employment and Retirement