CVIndependent

Tue07162019

Last updateTue, 18 Sep 2018 1pm

When California passed the nation’s first law to give consumers control over their personal data last year, legislators built in an unusual buffer—an extra year to change the law before it takes effect in 2020.

Lawmakers and lobbyists are now making use of that time, submitting at least 20 bills in recent weeks that would adjust, tweak or perhaps ultimately gut California’s unique privacy protections.

Privacy advocates are fighting to make the law even broader, while businesses and tech companies want to see it narrowed. The dynamic could force lawmakers to choose between constituents who overwhelmingly feel they have lost control of how their personal information is collected and used, and businesses (including many campaign donors) who argue that broad privacy protections could fundamentally damage the internet economy.

The issue landed in the Capitol with huge urgency because of a San Francisco real estate developer named Alastair Mactaggart. Last yearhaunted, he has said, by a dinner-party chat with a Google engineer who told him Americans would be stunned to know what the tech giant knew about themhe spent $3.2 million to put a data-privacy law on the ballot. Tech companies poured $1 million into a campaign to fight it, then decided they’d rather seek a compromise in the Legislature. Lawmakers rushed to pass a privacy law last summer, and Mactaggart pulled his measure off the ballot.

“I was aware when I withdrew the initiative that that would open us up to the possibility of change, both bad and good,” Mactaggart said to a panel of lawmakers this month. “I believe you guys are going to do a great job defending this bill, and making sure that when it goes into effect next year, it’s a great bill for California and for the world.”

The law requires that companies tell customers what information it collects about them and to whom they sell the data. It also requires that companies give customers an easy way to opt out of having their data sold, and limits how much more they can charge those who do.

It’s too soon to say exactly how or whether lawmakers will wind up changing the privacy law. Many of the bills that have been introduced are mere placeholders, and it’s still early in the legislative year. A lot can change before lawmakers cast their final votes in September.

But a few general themes have already emerged. Here’s what to watch as California’s privacy battle unfolds:

Teeth are a big fight: A key aspect of last year’s compromise between tech companies and privacy advocates was minimizing the opportunity for lawsuits. Under the deal they reached, the law only allows lawsuits over data breaches. But that’s now up for debate, with new bills giving Californians the right to sue companies that break other aspects of the privacy law, such as if they don’t give customers the opportunity to opt out of having their data sold or don’t delete data upon customers’ requests.

“In order to make sure they comply with the law, we need to make sure people can exercise their rights,” said Democratic Sen. Hannah-Beth Jackson, of Santa Barbara, who is carrying a bill that would expand the ability to sue under the privacy law. “If you don’t violate the law, you are not going to get sued.”

Big business is likely to push back hard.

California Chamber of Commerce lobbyist Sarah Boot said changing the privacy law to allow for more lawsuits would trigger “a class-action bonanza.”

“Frankly, our court system can’t handle that. California businesses can’t handle it. And the California economy can’t handle that,” Boot said in a hearing before Jackson’s bill was introduced.

Another flashpoint is a change the tech industry wants—limiting which bits of information consumers can opt out of having sold. Tech companies argue that the law should be narrowed so they can still exchange non-identifiable information with advertisers about, for instance, users’ devices and operating systems.

“Treating this as the sale of personal information jeopardizes the underpinnings of the internet,” said Internet Association lobbyist Kevin McKinley.

Privacy advocates caution that some changes that seem small may actually weaken the law.

“Powerful tech companies and their clever lobbyists know how complex privacy policies are, and what they may present as a small tweak here and there can fundamentally change the entire law and completely obliterate the rights people have,” said a statement from Jim Steyer, CEO of Common Sense Media, a nonprofit that is part of a coalition of privacy advocates.

Politics aren’t on usual lines: Lawmakers passed the privacy bill last year with a sweeping bipartisan vote, and the issue continues to resonate across the political spectrum.

Republicans—trying to make themselves relevant in a Legislature where Democrats have an enormous majority—have introduced a package of privacy bills, including one that would require social-media companies to permanently delete data when people delete their account, and another that would prohibit companies from saving the voice commands people give smart speakers such as Amazon’s Alexa.

GOP Assemblyman Jordan Cunningham said he’s gotten some blowback from business lobbyists who are used to having Republicans on their side.

“Some people are like, ‘What are you guys doing?’” said Cunningham, of San Luis Obispo. “Privacy is a nonpartisan issue to me. It’s a nonpartisan issue to my constituents. When I talk to people in my district, they uniformly want this stuff. They know their data is being used in ways they’re not aware of.”

Democrats control the legislative process, so one political question to watch is whether they allow Republican privacy bills to advance, or quietly kill them. The other political question is whether Democrats themselves will split over any of the proposals, as happens on many fights in the Capitol that impact big business.

“I think there will be a real battle between the pragmatists and the idealists,” said Steve Maviglio, a Democratic political consultant who worked on the tech companies’ brief campaign against the privacy ballot measure. “That’s where it’s going to lie.”

Washington is a wildcard: While California is debating changes to its privacy law, federal lawmakers are also considering a nationwide version. At a pair of recent hearings in Washington, House Democrats vowed to get tough on tech companies, and Senate Republicans said they would like to pass a national privacy law that overrides California’s.

Internet companies would prefer a single national law over a patchwork of rules across the states. Privacy advocates, meanwhile, have argued that any nationwide privacy law should be structured to set a tough minimum baseline of privacy protections upon which state laws could build.

Built into the argument is the sense, on both sides, that California’s size and market influence will do for internet regulation what it did for rules around auto emissions—force the industry to essentially default to California’s regulations as the national standard.

There, too, California politics could be a factor.

Mactaggart said he thinks it’s unlikely that Congress will pass a law that would substantially weaken California’s, given the size of the state and the prominence Californians hold in the House—both the speaker, Democrat Nancy Pelosi, and the minority leader, Republican Kevin McCarthy, hail from the Golden State.

“It’s going to be hard for them to step in and gut a law that protects one in eight Americans,” Mactaggart said.

CALmatters.org is a nonprofit, nonpartisan media venture explaining California policies and politics.

Published in Politics

It wouldn’t be election season without a bunch of big-money interests trying to tell you how to vote—and with hundreds of millions of dollars rolling into initiative campaigns over housing and health care, California hit a new record this year.

The $111 million campaign against Proposition 8 on kidney-dialysis clinics amounts to the most money poured into a single side of a ballot measure in the United States—at least since electronic record-keeping began in 2002, and possibly ever.

Here are three industries spending huge sums to influence your vote:

Landlords and real estate agents outraising rent-control advocates 3-to-1

Landlords are largely bankrolling the campaign against Proposition 10, which would allow local governments to expand rent control.

“They don’t want to see their property values decline; it’s that simple,” said Steve Maviglio, spokesman for the No on Prop 10 campaign, which has raised $74.7 million.

Prop 10 would repeal a 1995 state law that forbids cities from applying rent control to single-family houses, or any type of home built after 1995; that 1995 law also allows landlords to raise apartment rent any time a tenant moves out. Instead, the ballot measure would give cities the option to expand rent control to cover more homes—making it harder for landlords to turn a profit.

“It’s about their future, their bottom line. That’s why they’re spending so much,” said Charly Norton, spokeswoman for the Yes on Prop 10 campaign, which has raised $25.9 million, mostly from the AIDS Healthcare Foundation.

Supporters say Prop 10 is necessary, because homelessness is on the rise, and a growing share of Californians spend more than half their income on rent. Opponents say it will worsen the state’s housing shortage by discouraging developers from building more homes.

Donors against Prop 10 include corporate property owners like Blackstone, Essex and Equity Residential, as well as many individual landlords. The biggest donor is the California Association of Realtors, which has given $8 million to the campaign.

The Realtors' association also has poured $13.2 million into the campaign for Proposition 5, making it the sole funder of that push to change California’s property-tax law.

Californians now generally pay much higher property taxes if they buy a new home after selling a house they’ve owned for many years. That’s because property taxes are based on the sales price of a house, not how much it’s worth as it appreciates over time. This initiative would allow three categories of homeowners—those over 55, disabled or who lost their homes in natural disasters—to keep the property-tax levels of the home they sold if they buy a new home. Real estate agents say it would encourage older Californians to sell their homes, making more houses available in our tight market. (Experts disagree.) Of course, it also would boost their commissions.

“It will give a huge windfall to the real estate industry,” said Mike Roth, spokesman for the campaign against Prop 5, which has raised about $3.2 million, largely from public-employee unions that could see cuts if the government loses tax revenue.

Steve White, president of the California Association of Realtors, insisted it’s about “meeting a need. The unaffordability of housing in California … is largely dictated by lack of availability,” he said. “We have tens of thousands of homes that could be waiting for all those tens of thousands of younger families.”

Dialysis clinics outraising labor opponents 5-to-1

The most expensive fight on the California ballot this year is over Proposition 8, which would limit profits for dialysis companies. The businesses are fighting back, pouring $111 million into the campaign against Prop 8—most of it from two dialysis companies, DaVita and Fresenius.

“Prop 8 was designed to have a negative impact on dialysis clinics in California, and that’s why the groups that are opposed are fighting it so heavily,” said Kathy Fairbanks, spokeswoman for the No Prop 8 campaign.

She said the measure wouldn’t allow dialysis clinics to be reimbursed by insurance companies for many routine business expenses. Ultimately, that would cause companies to close clinics, Fairbanks said, giving patients fewer places to seek treatment.

Workers at dialysis clinics are not unionized. A labor group that represents other health-care workers has had its sights on organizing dialysis workers, and put Prop 8 on the ballot as part of a much larger feud within the industry.

“This record amount of (campaign) spending speaks to the priorities of the dialysis corporations, which is to protect their profits,” said Sean Wherley, spokesman Service Employees International Union-United Healthcare Workers, the sponsor of Prop 8.

The Prop 8 campaign has raised $20.3 million, most of it from SEIU United Healthcare Workers. The union argues that dialysis clinic companies are netting huge profits while allowing shoddy health and safety conditions at some clinics. Limiting the companies’ profits to 15 percent, as Prop 8 calls for, would encourage the clinics to put more money into improving patient care, the union argues.

Ambulance companies outraising labor opponents more than 600-to-1

Colorado-based company American Medical Response put Proposition 11 on the ballot and contributed most of the $29.9 million raised to support it. The measure would allow private ambulance companies to require workers to remain on call during breaks, so they can respond to an emergency even if it comes while they’re eating lunch. That’s already the common practice, but this measure comes in response to a court ruling that security guards cannot be required to stay on call while they’re on breaks. Ambulance companies don’t want to be held to the same standard.

“If applied to the ambulance industry, it would have a significant public safety risk,” said Marie Brichetto, spokeswoman for the Yes on Prop 11 campaign.

Opponents—the emergency responders who work on ambulances—aren’t raising much money; the American Federation of State, County and Municipal Employees union contributed just $47,000 to oppose Prop 11.

“This is a classic ‘big corporation against its own employees,’” said Jason Brollini, president of the United EMS Workers union that is affiliated with AFSCME.

He contends the ambulance companies’ real motive with Prop 11 is to eliminate any liability they could face from employees who sue over not getting the extra pay they’re supposed to receive when their breaks are interrupted by an emergency call.

CALmatters.org is a nonprofit, nonpartisan media venture explaining California’s policies and politics.

Published in Politics