California Bill Would Provide Major Impetus for Employee Ownership
In what would be the most significant step forward by a state yet, Senator Josh Becker has introduced Senate Bill 1407, the Expanding Employee Ownership Act. The bill would provide outreach, financing, and technical assistance for conversions to employee ownership.
The bill would:
- Create a “California Employee Ownership Program” to be administered by an “Employee Ownership Program Manager.”
- Appropriate funds to make grants to qualified nonprofits to provide outreach and education programs on employee ownership in the state;
- Provide grants of up to $50,000 per company to pay for up to 50% of the cost of conducting feasibility assessments for employee ownership transitions.
- Direct the Program Manager to “work with all California state agencies whose regulations and programs affect employee-owned companies, and businesses with the potential to become employee owned, to enhance opportunities and reduce barriers.”
- Direct the Program to “work with the California Infrastructure and Economic Development Bank, the California Pollution Control Financing Authority, and related entities to shape and implement guidance on lending to broad-based employee ownership vehicles.” This could result in these agencies making loans or loan guarantees for ESOP transition (the Pollution Control Financing Authority has a very broad scope that possibly could include such loans).
Senator Becker is a Democrat representing the San Francisco Bay area. The bill has bipartisan sponsorship and support from committee chairs of the relevant committees. Hearings will occur in the next several weeks.
Senator Becker has urged those who support the bill to contact their representatives about it as soon as possible. Sponsors currently include Senator Andreas Borgeas, R-Fresno; Senator Rosilicie Ochoa Bogh, R-Yucaipa; Senator Anthony Portantino; D-La Cañada Flintridge, and Assembly member Phil Ting; D-San Francisco.