PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

California Policy Gone Mad: Advocate for Entrepreneurs Slams “Harmful” and “Ridiculously Redundant” AB 257

By at 26 August, 2022, 12:19 pm

NEWS

For Immediate Release

Washington, D.C. – California’s elected officials seem to be doing everything they can to make it very difficult – if not impossible – for entrepreneurs to start businesses and for small businesses to operate and grow in the state. According to Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan, AB 257 – the FAST Act – which will soon be considered by the California Senate, will only drive more entrepreneurs, capital, businesses and workers from the state if the bill becomes law.

“The Golden State has unfortunately become the gouging state when it comes to small businesses. High taxes, costly regulations and the threat of more mandates and anti-business policies have already driven hundreds of businesses and residents from the state. Add AB 257 to the list of pointless and harmful policies that only burden businesses and consumers, and in this case would do great harm to the franchise model in California, and to the owners of food franchises, their workers and customers via higher food prices,” said Kerrigan.

AB 257, which faces widespread opposition among small businesses across the state and is highly unpopular with the general public (less than one-third of Californians support the bill), would establish an intrusive and bureaucratic “Fast Food Sector Council” to fully regulate all counter-service restaurants in the state. This Council, which unfairly and unnecessarily targets the quick-serve restaurant sector, would be comprised of 13 unelected political appointees who would determine wages, benefits, and working conditions, effectively taking critical operating decisions and flexibility away from the individual owners of these franchises. Of the 34,700 food franchises in California, 69.4% are single-unit franchises.

Kerrigan added:

“California already imposes very stiff labor laws and regulations. AB 257 is ridiculously redundant. It would only intensify the harsh policy costs and reputation that is driving people, capital and businesses out of the state. Snuffing out entrepreneurial opportunity through franchise ownership as AB 257 would ultimately do, not only harms the 34,700 food franchises in California, but the hundreds of thousands of employees who work for these local businesses. Local economies and communities will be vastly harmed by higher food costs, potential business closure, lost opportunity and tax revenue. I have no idea what the supporters of AB 257 are thinking, but those elected officials who may be still on the fence about this bill have every reason to vote No. The FAST Act would only accelerate the departure of entrepreneurs, residents and capital from California.”

According to Kerrigan, the bill must be voted on by August 31.

CONTACT:

Karen Kerrigankkerrigan@sbecouncil.org

SBE Council is nonpartisan advocacy, research and education organization dedicated to protecting small business and promoting entrepreneurship. For 28 years, SBE Council has worked on and advanced a range of private sector and public policy initiatives to strengthen the ecosystem for strong startup activity and small business growth. Visit www.sbecouncil.org for additional information. Twitter: @SBECouncil

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