FOCUS ON THE STATE

All politics are local. As is the case with all clever aphorisms, that one too has its limits. Some politics are state. More germane to this update, some public policies that affect the golf industry are decided at the state level. And it is to a few of these that we address your attention today.

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AB 1346 (Berman; D-Menlo Park). One of the bills that the California golf community has been watching and working in the 2021 legislative session, this piece of legislation directs the California Air Resources Board (CARB) to adopt a Rule phasing out the sale of all gas-powered equipment less than 25 horsepower by 2024 or another date or set of dates deemed more feasible by CARB during its administrative rulemaking process.

Armed with the understanding that to persuade the State of California to not pursue the substitution of electric power for gas power is a fool’s errand, the California golf community determined to pursue the wise person’s alternative; otherwise known as the pursuit of language in the bill directing CARB to apply measures of feasibility, flexibility, and affordability in the adoption of the Rule. In other words, language ensuring that when CARB sets these dates, battery powered equipment that is fit for intended use by the golf industry is commercially available, different dates for different classes of equipment are established where commercial unavailability requires, and both agency and legislature consider the creation of ways to incent the users of such equipment to phase out their gas-powered equipment in favor of electric powered equivalents – e.g., rebates and tax credits.

We are happy to report that as it rounds to what we know will be a successful finish line by close of session (September 10), AB 1346 has been amended to define the three features the golf community has been advocating – feasibility, flexibility, and affordability.

Excerpted from AB 1346 as it now stands:
(1) By July 1, 2022, the state board shall, consistent with federal law, adopt cost-effective and technologically feasible regulations to prohibit engine exhaust and evaporative emissions from new small off-road engines, as defined by the state board. Those regulations shall apply to engines produced on or after January 1, 2024, or as soon as the state board determines is feasible, whichever is later.

(2) In determining technological feasibility pursuant to paragraph (1), the state board shall consider all of the following:
(A) Emissions from small off-road engines in the state.
(B) Expected timelines for zero-emission small off-road equipment development.
(C) Increased demand for electricity from added charging requirements for more zero-emission small off-road equipment.
(D) Use cases of both commercial and residential lawn and garden users.
(E) Expected availability of zero-emission generators and emergency response equipment.

Consistent with the regulations adopted pursuant to this section and relevant state law, the state board shall identify, and, to the extent feasible, make available, funding for commercial rebates or similar incentive funding as part of any updates to existing, applicable funding program guidelines for districts to implement to support the transition to zero-emission small off-road equipment operations.

The California golf industry has all the tools it needs to protect its interests when CARB crafts a Rule to phase out the sale (albeit not the use) of some of the gas-powered equipment the industry now routinely uses. And we are ready and quite able to use those “tools” to work with CARB to fashion a Rule the industry can live with. Indeed, we have already begun to assemble the theory of our particular case and the facts cum arguments in support of that case.

Practicing the art of the possible to achieve the best available outcome; that’s how we would characterize this episode in advocacy; indeed, all successful episodes in advocacy.

Proposition 22. Passed by the California electorate last November by a 58-42% margin, the initiative allowed certain gig industries (driver app-based, e.g., Uber and Lyft) to classify their workers as independent contractors in direct exception to AB 5’s legislative codification of the California Supreme Court’s decision in Dynamex.

Last week a Superior Court Judge in Alameda County struck down the initiative as violative of California’s Constitution in two respects: 1) It unduly infringed on the legislature’s right to regulate workers’ compensation rules, because it introduced the ballot measure as a statutory initiative rather than a constitutional amendment, and 2) it was not limited to a “single subject” as required by the California Constitution. While the Judge added that it indirectly prevented gig drivers from bargaining collectively, he did not appear to invoke that as one of the reasons for his finding of unconstitutionality. Because the decision is predicated entirely on California’s Constitution, there is no appellate recourse in the Federal courts; however, expect there to be plenty of appellate recourse in the state courts. No doubt, the California Supreme Court will end up resolving this, and no doubt until they do, the backers of Proposition 22 and their Amici will seek and receive injunctive relief in the form of Proposition 22 remaining in effect until then. That could take more than a year.

The prospects on appeal? That’s well above our pay grade, but not to worry. There won’t be a shortage of speculation from constitutional scholars with impeccable credentials who will disagree with each other as persuasively as they will issue arguments in favor of their differing positions. The legal issues are just too complicated, not just in terms of the validity of the arguments on both sides of this divide, but also in terms of the consequences of any final resolution.

According to research performed by the Center for Governmental Studies and reported in the Los Angeles Times, of the 65 ballot measures approved in the state from 1964 to 2007, twenty have been partially or entirely invalidated after being adjudicated through California’s courts – just short of 1/3. That’s a lot of invalidation. On the other hand, it was the California Supreme Court that started all of this when it issued its decision in Dynamex.

Stay tuned. None of this directly affects golf in the short term to the degree to which PGA golf professionals are able to work as independent contractors under the terms of AB 2257’s “business to business for professional services exception” and youth sports coaches and caddies have routes to independent contractor status under the Act’s “referral agency exemption.” However, in the longer term the resolution of these legal issues is sure to affect golf to the degree to which the narrow thinking unleashed by Dynamex and codified in turn by AB 5 and AB 2257 may be displaced by a much more expansive and we would add modern and less Manichean view of the relationship between “employment” and “independent contracting.”

Click here for those who would like a copy of that section of AB 2257 that outlines the “business to business for professional services exception” under which PGA pros and youth sports coaches are able to work as independent contractors. Click here for those who would like a copy of that section of AB 2257 that provides an avenue for independent contractor caddies. Both too are examples of “successful episodes in advocacy.”


SB 9 (Atkins; D-San Diego) and SB 10 (Wiener; D-San Francisco). These are housing bills pure and simple; they don’t directly relate to golf courses in any way, shape, or form. However, their success or failure in this legislative session will go a long way toward telling us something important about the political resonance of the arguments golf routinely uses to blunt the appeal of bills like AB 672, a bill that comes back in January 2022 as a 2-year bill that would remove the state’s municipal golf courses from the protections provided by the California Park Preservation Act, Environmental Quality Control Act (CEQA), and local zoning prerogatives.

SB 9 makes it easier to build smaller second units on what are now locally zoned as single-family properties. Up to four units (e.g., duplexes or homes with attached living units) would be enabled if the lot were to be split into two equal parcels. The proposed legislation largely obviates local controls, albeit it has been amended to add ways that local governments can block construction for public safety and/or health concerns.

SB 10 makes it easier for local governments to rezone neighborhoods in proximity to mass transit to accommodate up to 10 housing units on what was previously zoned for much less. Easier but not mandatory, as some of the author’s failed efforts in previous legislative sessions would have done.

Despite vehement opposition from municipal governments throughout the state, including the Los Angeles City Council by an almost unanimous margin, both bills have just cleared the Assembly – SB 10 on a 45-19 vote and SB 9 on a razor thin 41-9 vote.

It takes 41 votes to pass muster in the Assembly; there are 80 members. Given all that opposition, much of it quite visceral, a lot of members opted not to cast a vote. Californians treasure their single-family neighborhoods. But both bills passed, and that tells us something about the seriousness with which policymakers take the housing shortage and the precariousness of some of the arguments that golf uses to blunt efforts to change California law to enable the transformation of municipal golf courses into housing tracts.

These bills have not yet passed into law. There are more hurdles along that way, including the affixation of a gubernatorial signature from either a surviving Governor Newsom facing re-election next year or a new governor highly likely to veto them. The significance of having gotten this far, and it’s quite far, is that similar pieces of legislation in recent sessions have fallen flat.

Winds shift. Attitudes evolve. Yesterday’s political nonstarter is tomorrow’s accepted wisdom. To be forewarned is to be forearmed.

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We haven’t forgotten drought, and drought hasn’t forgotten us. Last week Ventura became the 51^st California county to categorize itself as being in extreme drought, and the City of Pasadena began to craft mandatory water cutbacks. Regarding the state, don’t expect anything until the votes are tallied in the gubernatorial recall election (September 14) and don’t expect much immediately thereafter until the full ramifications of that vote, one way or the other, are understood. We’ll be updating all of this in a report later this week.