Call for Greater Transparency Regarding Warehouse Subsidies, Salaries, Impact of Automation

Call for Greater Transparency Regarding Warehouse Subsidies, Salaries, Impact of Automation


Riverside Assemblyman Jose Medina, is championing legislation, Assembly Bill (AB) 485, the Local Government: Economic Development Subsidies Measure, which could potentially slow the ever-expanding growth and impact of warehouses in the inland region.   The measure would press local officials to attract jobs to the area beyond those offered by the warehouse industry in hopes other businesses/industries would offer higher wages, better benefits and be more conducive to the overall benefit of public health—i.e., create less pollution.  Under current law local agencies are required to provide specified information to the public before approving an economic development subsidy within its jurisdiction, and to hold hearings and report on those subsidies, as provided. The law defines “economic development subsidy” for these purposes to mean any expenditure of public funds or loss of revenue to a local agency in the amount of $100,000 or more, to stimulate economic development within the jurisdiction.  The same would hold true under the new legislation, however AB 485 would also prohibit a local agency from signing a nondisclosure agreement regarding a warehouse distribution center as part of negotiations or in the contract for any economic development subsidy—after all, a community has a right to know if it is forgoing tax revenues as a result of such agreements. The measure would apply to all local municipalities—cities and counties—and they would further be required to disclose specific employment details, including how many jobs will be created, the number of full-time versus part-time positions, wage/salary amounts and benefits. Warehouse owners/operators would also be required to present forecasts detailing how long jobs are projected to last before employees are displaced by automation.  Medina believes it is important that taxpayers understand how their tax dollars are being used in this regard and what kind of return they should expect for their investment. According to a report by SCNG, the legislation has received pushback from local communities like Moreno Valley who have experienced a large influx of warehouses in recent years and have plans to add more.  Regardless of the pushback, AB 485 passed the Assembly last month by a wide margin, 58 to 17. Medina expects it will also succeed in the Senate and he is optimistic Governor Newsom will sign it into law.

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