CRA Member Newsletter June 2025

CRA Member Newsletter

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June 30, 2025 | CRA Newsletter: Legislative, Regulatory and Other Updates

Message from the President

Members,

As we close out June, I want to update members on significant developments impacting California’s retail sector and highlight key advocacy efforts CRA is leading.

State Budget Signed:

Governor Newsom signed the 2025 state budget, a plan that addresses a $12 billion deficit while safeguarding core programs and investing in housing, jobs, and public safety. The Governor’s signature is contingent on the Legislature advancing critical housing reforms he requested to cut red tape and accelerate housing development statewide, especially in the areas impacted by January fires. While some progressive priorities have been pared back, the budget avoids cuts to safety net programs and uses state savings, special fund borrowing, and delayed payments to bridge the gap. CRA remains vigilant against proposals that would increase taxes or impose new costs on California businesses.

Legislative & Local Policy Updates

Self-Checkout: CRA continues to advocate on SB 442 (Smallwood-Cuevas), which would impose strict limits on self-checkout in grocery and drug stores, including item caps and staffing mandates. We are working to ensure any policy changes consider both operational realities and customer experience. In addition, CRA is pushing for amendments to the bill that will include statewide preemption.

Long Beach Self-Checkout Ordinance: The City of Long Beach is considering an ordinance to require minimum staffing at self-checkout lanes, with potential fines for noncompliance. CRA is engaging with city leaders to highlight the impact on retailers and the need for balanced solutions to address theft and safety concerns.

Looking Ahead

Priority Legislation: In addition to SB 442, CRA is actively engaged on AB 1018 (Bauer-Kahan), which addresses automated decision-making technology. We are working closely with the author to ensure the bill protects retailers using these technologies, while avoiding unnecessary liability and regulatory overreach.

SB 707 Workshop: CalRecycle is hosting an informational workshop on July 17, 2025, in Sacramento, to introduce the implementation of the Responsible Textile Recovery Act (SB 707, Newman). CRA will be there to provide initial comments, and we encourage members to participate and provide input as California develops new rules for textile stewardship. Please reach out to CRA directly if you would like more information.

Regulatory Wins & Ongoing Work

Compostable Product Labeling: CRA secured a major win with the extension of the state’s compostable labeling law compliance deadline to 2027, providing retailers and manufacturers more time to adapt. I spoke directly with members of the Governor’s cabinet as well as the senior staff in the Governor’s office to secure the exemption. We are now partnering with CalRecycle to pursue a long-term fix that ensures clarity for both businesses and consumers.

Embedded Batteries: CRA continues to work with CalRecycle on the implementation of SB 1215 (Newman) which sets new requirements for products with embedded batteries. Our focus remains on practical compliance pathways for retailers and manufacturers. If you would like more information on the work we are doing please reach out to the CRA team.

2025 CRA Fall Summit – Napa Valley

Registration and sponsorship opportunities are now open for the 2025 CRA Fall Summit in beautiful Napa Valley. We look forward to bringing our retail community together for networking, education, and collaboration on the most pressing issues facing California retailers. I am thrilled that Cal Recycle Director Zoe Heller is confirmed, as is Nick Schults, chairman of the Assembly Public Safety Committee. In addition, Attorney General Rob Bonta has been invited as our special guest for the kickoff dinner on Sunday night, and his team is working hard to make sure he can be there. Space is limited and sponsorship opportunities will be out shortly. Don’t miss your opportunity to bring you legal, compliance and public policy teams to help CRA educated policy makers on issues that impact retailers in California and beyond. CLE credits will also be available.

Thank you for your continued engagement and support of our efforts on your behalf. Together, we are making a difference for California’s retail industry.

Rachel

In This Newsletter Issue:

Legislative Updates
Regulatory, Local and Federal Updates
Prop. 65 Annual Conference
Save the Date for CRA Fall Summit
Member News
Other Outreach, Activities & Updates

Legislative Updates

CA STATE BUDGET

Governor Gavin Newsom signed the 2025 state budget bill contingent on the legislature passing budget committee bills AB 131 or SB 131. The budget the legislature sent to Newsom pares back a number of progressive priorities, including a landmark health care expansion for low-income adult immigrants without legal status, to close a $12 billion deficit. Newsom's signature, however, will be void if lawmakers don't send him legislation to make it easier to build housing by Monday, June 30. The budget avoids cuts to safety net programs and uses state savings, borrowing from special funds and delaying payments to address the budget gap.

California also faces potential federal cuts to health care programs and broad economic uncertainty that could force even deeper cuts. Newsom in May estimated that federal policies — including on tariffs and immigration enforcement — could reduce state tax revenue by $16 billion.

Republican lawmakers said they were left out of budget negotiations. They also criticized Democrats for not doing enough to address future deficits, which could range between $17 billion to $24 billion annually. Read more.

CRA signed on to a growing coalition letter letter to the state legislature concerning potential tax Increases and other revenue-generating proposals in the state budget. The letter cautions legislators that placing additional burdens on California businesses would have a negative economic impact, discouraging business growth and elevating the cost of living in California. Proposals that progressive groups are advocating include, among other things, a multibillion-dollar tax increase on large companies that do business in California (through the elimination of the water’s-edge election) and higher taxes on employers whose employees receive healthcare through Medi-Cal. Read the draft letter HERE. A final copy will be available on CRA's member portal.

The CRA team also joined industry efforts in opposing AB 130 and SB 130 regarding the recent Vehicle Miles Traveled (VMT) legislation included in the Governor's budget, which will be voted on Monday, June 30. These bills, if passed, will effectively kill new housing efforts in the state by imposing "economically impossible and legally flawed burdens" to housing production. The bills have no sound economic data, with experts describing the state's VMT targets as a "fairy tale" that is unachievable. For some approved housing sites, the VMT mitigation cost could reach $2 million per unit. Get more information HERE.

AUTOMATED DECISION MAKING

The CRA team is working with Assemblywoman Rebecca Bauer Kahan on her bill AB 1018 related to automatic decision making (ADT). At the member's request, we have drafted language and collected feedback from our members related to service provider agreements to protect DEPLOYERS of ADMT. This language is a starting point for continued conversations. We will be scheduling a zoom call with the Assemblywoman to discuss the bill and any amendments. This call is for those with a legal background and can speak to the legalities of the bill. If you would like to participate (date is still to be determined) please let us know and we will add you to the list.

GEOLOCATION

The CRA team is compiling feedback we received from our members and determining next steps regarding a bill that was recently "gutted and amended" - AB 322 (Ward) to address geolocation.

PHARMACY

The California Board of Pharmacy's sunset review bill - AB 1503 (Berman) - will no longer be heard in the Senate Business, Professions, and Economic Development (B&P) Committee on Monday, June 30 and has been pushed to the July 14 B&P hearing. There are no updates on bill amendments or final positions or anything further at this time. The CRA team has met Senate B&P committee staff and legislative members and the conversations have been productive. We will continue to do outreach on the California Community Pharmacy Coalition's (CCPC) top priorities in the bill leading up to the rescheduled hearing date.

Legislative Deadlines:

June 27, 2025 - State Budget (SB 101) Agreement deadline between Legislature and Governor
August 18, 2025 - Legislature Reconvenes
September 12, 2025 - Last day to pass bills; Interim recess begins upon adjournment

Regulatory Updates

CalRecycle Updates

TEXTILES

SB 707 - TEXTILES EPR

CRA, along with the National Retail Federation (NRF) and American Apparel & Footwear Association (AAFA) is inviting members to the CalRecycle SB 707, The Responsible Textile Recovery Act of 2024 (Newman), Workshop on July 17, 2025, in Sacramento from 10:00 am to 3:00 pm PST, a pivotal event for retailers committed to shaping the future of responsible textile recovery in California.

We will be joining a lunch with the California Product Stewardship Council - one of the sponsors of SB 707 - and we are working on setting up an afternoon meeting with CPSC and a dinner afterwards, both exclusive for our members. Get more information and sign up for the workshop events HERE.

PACKAGING

SB 54 - Packaging EPR

CalRecycle Advisory Board Appointments

CRA President Michelin was recently appointed to a second three-year term on the SB 54 Advisory Board. There were five additional appointments made to the Board. View the CalRecycle announcement HERE.

Recap of SB 54 CMC and Source Reduction Baseline Reporting Guidance Workshop

CalRecycle held a non-regulatory public workshop to collect feedback on the covered material category (CMC) and source reduction baseline reporting guidance for the Plastic Pollution Prevention and Packaging Producer Responsibility Act [Senate Bill (SB) 54 (Allen, Chapter 75, Statute s of 2022 )].View the recap along with additional information about the workshop HERE and the slides from the presentation can be found HERE.

CalRecycle Material Characterization Study

Public Resources Code (PRC) Section 42061(a)(2)-(3 ) requires CalRecycle to conduct a material characterization study of covered material categories and determine the approximate amount of those materials destined for final deposition at California landfills. To meet this requirement, CalRecycle conducted a statewide material characterization study to characterize and measure the amount of covered materials landfilled in California. Pursuant to Section 42061(a)(3), CalRecycle published the preliminary findings report (DRRR-2025-1755) on June 30, 2025.

CalRecycle Feedback Portal Reminder

This is a reminder for CRA members to continues to send feedback, questions and comments on the SB 54 regulatory package as CalRecycle is collecting feedback on the CMC and Source Reduction Baseline survey guidance documents through July 13. Send your feedback to sarah@calretailers.com.

SB 343 - Truth in Labeling

There continues to be a lot of frustration from all sides (industry and ENGOs) regarding SB 343 (Allen - 2021), which creates numerous conflicts with SB 54. We are also working with Californians Against Waste as well as CalRecycle Director Heller to respond to a number of issues we identified with the two statutes. Thank you to our members who helped us put together a memo detailing the conflicts. We will keep our members updated on those conversations as we work to streamline various environmental related laws and regulations.

BATTERIES

SB 1215 - Embedded Batteries

Senate Bill 1215 (Newman, Chapter 370, Statutes of 2022) amended and expanded the Electronic Waste Recycling Act of 2003 (SB 50) by adding covered battery-embedded products to the types of electronic devices covered by the law. Starting July 1, 2025, manufacturers of covered battery-embedded battery products must comply with new requirements. (Public Resources Code (PRC) Section 42466.2). Get more information HERE.

COMPOSTING

AB 1201 - Compostable Product Labeling

The CRA team, along with a coalition of businesses, achieved a big win with securing a letter from CalRecycle Director Zoe Heller, which confirmed an 18-month extension on AB 1201 (Ting - 2021), which would have, among other issues, removed compostable bags from retailer and grocery stores at the start of next year. CRA sent out a statement thanking both Governor Newsom and CalRecycle Director Heller for the extension, which provides more time to work on a long-term fix. Our statement also appeared in Politico and can be read in its entirety HERE. For more information or questions, reach out to Sarah.

PAINT

Request for Public Feedback on Draft Proposed Paint Stewardship Regulations

CalRecycle is seeking feedback on draft regulatory language to clarify existing language and implement new requirements established by Assembly Bill (AB) 1526 (Committee on Natural Resources, Chapter 848, Statutes of 2023) and Senate Bill (SB) 1143 (Allen, Chapter 989, Statutes of 2024).

These proposed regulations would implement the statutory addition of aerosol coating products, nonindustrial coatings and coating-related products into the Architectural Paint Recovery Program, which was renamed the Paint Product Recovery Program.

A copy of the draft proposed regulations is available for review at the link below. Comments are due to CalRecycle by July 9, 2025. If you would like CRA to submit comments on your company's behalf, please send feedback to sarah@calretailers.com by July 7.

Get more information HERE.

Privacy Updates

CA Governor Gavin Newsom's Artificial Intelligence Task Force released its final report on Frontier AI Policy. The full report can be read HERE. Governor Newsom commissioned the report in late 2024 "to help California develop workable guardrails for deploying generative AI, focusing on developing an empirical, science-based trajectory analysis of frontier models and their capabilities and attendant risks."

The report does not argue for or against any particular piece of legislation or regulation, however we expect state legislators and regulators to reference and consider this report as they develop proposals about the deployment and regulation of AI in the state of California.

Governor Newsom issued the following statement along with the release of the report:

"California is the home of innovation and technology that is driving the nation’s economic growth — including the emerging AI industry. As Donald Trump chooses to take our nation back to the past by dismantling laws protecting public safety, California will continue to lead the way with smart and effective policymaking. I thank the experts and academics who responded to my call for this important report to help ensure that, as we move forward to help nurture AI technology, we do so with the safety of Californians at the top of mind.”

CARB Updates

Diesel Locomotives

The California Air Resources Board (CARB) officially repealed its rule to phase out diesel locomotives. Board members voted unanimously to revoke the in-use locomotive rule, six months after the agency announced that it had withdrawn the emissions standard from consideration for an EPA waiver, once it became clear approval wouldn’t happen before former President Joe Biden left office.

Cal/OSHA Updates

Workplace Violence Regulations

The CRA team is working on a letter to the California Division of Occupational Safety and Health (Cal/OSHA) regarding the Agency's workplace violence advisory committee process and the Workplace Violence Prevention Plan, which was in SB 553 (Cortese - 2023), which we negotiated on with the Governor's office. Get more information HERE.

Please provide feedback to ryan@calretailers.com by July 7, 2025.

Board of Pharmacy Updates

CAPTCHA Verification

Beginning June 23, meeting invitations from Medi-Cal Rx require CAPTCHA verification for all external meeting attendees. This change will help enhance security and privacy, ensuring that only real people — not automated bots — can access meetings.

What is a CAPTCHA test?

A Completely Automated Public Turing test to tell Computers and Humans Apart (CAPTCHA) test is used to confirm that a user is a human and not a bot.

What to expect

External meeting attendees will see a CAPTCHA prompt when joining a meeting. Guests will have the option to complete either a text or audio test — a process that only takes a few seconds.

Notification of CalRecycle’s Disapproval of Foundation’s Proposed Changes its Stewardship Plan for Covered Drugs

On June 16, 2025, CalRecycle's director disapproved The Drug Takeback Solutions Foundation's (Foundation) request to use supplemental mail-back services in lieu of authorized collection sites in perpetuity throughout the state.

On June 17, 2025, CalRecycle’s director disapproved Foundation's proposed changes to its stewardship plan for covered drugs regarding a notification process for potential authorized collectors and other changes. CalRecycle reviewed this proposed change as a significant change pursuant to Public Resources Code section 42032(e) and California Code of Regulations section 18973.1(i).

Read about the decisions made in the signed letters linked in the public notice HERE.

Board Appointments

Kartikeya “KK” Jha, of Fresno, has been reappointed to the State Board of Pharmacy, where he has served since 2022. Jha has been District Director of Operations at Omnicare, a CVS Health Company since 2019.

Jason Newell, of Sacramento, has been reappointed to the State Board of Pharmacy, where he has served since 2024. Newell has been Principal and Co-Founder at System2Solutions since 2020.

Nicole Thibeau, of Los Angeles, has been reappointed to the State Board of Pharmacy, where she has served since 2021. Thibeau has been Director of Pharmacy Services at the Los Angeles LGBT Center since 2013.

Local and Federal Updates

Local Updates

City of Long Beach Self-Checkout Ordinance

CRA President Michelin sent a letter to the Mayor of Long Beach and copied Long Beach city council members as well as state legislators representing Long Beach, requesting a meeting to discuss retailers' concerns regarding the proposed self-checkout ordinance currently under consideration by the Long Beach City Council.

While we appreciate the City’s commitment to public safety and understand the importance of addressing retail theft and workplace safety in our communities, recent statewide legislation, including the comprehensive 2024 retail theft package and pending Cal/OSHA workplace violence regulations, negates the need for this ordinance. State laws now provide robust protections and tools to address the challenges that the Long Beach ordinance is trying to address. Read the letter we submitted HERE.

Federal Updates

USTR China Shipbuilding Port Fee

CRA signed on to an industry letter, which was sent to the US Department of Homeland Security and US Customs and Border Protection urging the Trump Administration to engage with supply chain stakeholders to address questions and concerns regarding ongoing challenges with the interpretation of the “in- transit” reciprocal tariff exclusion to date. There are outstanding questions regarding how relay vessels are addressed which continue to create confusion and disruption to supply chains. The letter included trade associations representing American importers, exporters, transportation providers and other supply chain stakeholders. Read the letter HERE.

Request for State Actions to Preserve California’s Global Trade Competitiveness

CRA signed on to a letter sent to CA Governor Gavin Newsom with suggestions for actions to minimize negative impacts from the current federal trade policy chaos. Read the letter HERE.

Prop. 65 Annual Conference

Early bird discount expires at midnight July 18!

This year's Prop. 65 Conference will be held on Monday, September 8, at the beautiful Julia Morgan Ballroom in San Francisco. The agenda is currently in progress and will be available soon.

The Annual Prop. 65 Conference is a unique gathering of over 250 businesses, trade associations, attorneys and regulators who seek to learn about, discuss varied perspectives and improve California's law aimed to reduce or remove toxic substance routes of exposure. Last year’s feedback from sponsors, attendees, and speakers was overwhelmingly positive.

CRA Retail Summit

Registration and Sponsorships Opening Soon!

Join the California Retailers Association October 26-28 at the Meritage Resort & Spa in Napa Valley for the 2025 Retail Law & Policy Uncorked: The California Summit, Where California Sets the Standard—Navigating Retail’s Legal, Regulatory and Policy Frontiers Nationwide.

This gathering represents CRA's first-ever Retail, Legal and Regulatory Summit, a premier three-day event set in the scenic Napa Valley, convening national retailers, policy makers, regulators and legal experts in addressing the most pressing legislative, legal and regulatory issues impacting the retail industry in California and beyond.

Attendees will:

Gain actionable insights on the latest environmental litigation, compliance and extended producer responsibility (EPR) laws directly impacting retailers, including greenwashing, PFAS and California’s new climate disclosure mandates.
Stay ahead of fast-evolving privacy and cybersecurity regulations. Hear from regulators and top policymakers on CPRA enforcement, children’s privacy and the transformative Delete Act, with practical strategies for compliance and cross-jurisdictional readiness.
Learn how to navigate complex pricing laws, litigation risks and workforce mandates, including wage statement compliance, arbitration enforcement and new whistleblower protections, with guidance from leading legal and legislative experts.
Discover best practices for integrating AI into retail contracts and HR, addressing algorithmic transparency, liability and California’s unique regulatory requirements for artificial intelligence in hiring and promotion.

Network with and hear directly from influential speakers shaping California’s retail legal landscape. Invited speakers include:

Director Zoe Heller, CalRecycle - CONFIRMED
Assemblymember Nick Schultz, Chair, Assembly Public Safety Committee; Member of the CA State Bar - CONFIRMED
The Honorable Rob Bonta, California Attorney General
Cabinet Secretary Dee Dee Myers; Director, GoBIZ + Senior Advisor to Governor Newsom
Senator Catherine Blakespear, Chairwoman, Senate Environmental Quality Committee
Chairman Tom Umberg, Senate Judiciary Committee (member of the CA State Bar)
Chairwoman Rebecca Bauer Kahen, Assembly Privacy and Consumer Protection Committee (member of the CA State Bar)
Tom Kemp, Executive Director, California Privacy Rights Agency (CPRA)

This summit is a must-attend for in-house attorneys, compliance officers, policy professionals and government affairs leaders seeking to proactively manage risk, influence policy and ensure their organizations thrive amid California’s rapidly changing legal and regulatory environment.

Earn CLE credits, network with colleagues and enjoy California's wine country.

Registration, sponsorships and additional details coming soon!

For more information visit CalRetailers.com Visit www.calretailers.com

CRA Member News

How The Home Depot Responds to Natural Disasters Resource

The Home Depot (THD) released their Natural Disaster Response. Many states in the West have had the unfortunate need to address increasingly dangerous wildfires and this resource provides more background on the work THD does before, during and after a disaster event and the steps community members can take to prepare. It is also a good resource to reference for requests from emergency management officials. Learn more.

Other Outreach, Activities & Updates

Sustainable Apparel and Textiles Conference

CRA President and CEO Rachel Michelin was a featured speaker last week at the Sustainable Apparel and Textiles Conference in New York alongside CalRecycle Director Zoe Heller. The Conference is the leading ethical apparel conference for circular fashion supply chain and textile industry transparency. CEO Michelin and Director Heller were on a panel titled "California’s new Textile Recovery Act: A breakdown of the steps for EPR compliance in 2026". Get more information HERE.

Santa Monica Travel & Tourism 16th Annual Tourism Summit

CRA President Michelin spoke to nearly 200 Santa Monica community members at the SMTT 16th Annual Tourism Summit. SMTT’s signature event highlighted that Santa Monica’s tourism sector injected over $916.6 million into the local economy and supported 6,487 jobs, fueled by the arrival of 4.2 million visitors in 2024. International visitors remain our top priority to ensure full economic recovery.

Michelin joined SMTT President/CEO, Misti Kerns, keynote speaker Caroline Beteta, President & CEO of Visit California, Geoff Freeman, President & CEO of the U.S. Travel Association, Erin Francis-Cummings, President & CEO of Future Partners, Jot Condie, President/CEO of the California Restaurant Association and Lynn Mohrfeld, President & CEO of the California Hotel & Lodging Association.

CRA Summer Internship Program

The CRA team's Summer Internship Program is underway and we wanted to take a moment and give a shout out to one of our interns, Ethan James. Ethan has jumped right into the hustle and bustle of legislative and regulatory advocacy joining our team in giving "me too's" in second house policy committee hearings on the various bills CRA is engaging on. Ethan comes to us all the way from Ohio and is exploring industries as he prepares to head off to college. Career aspirations include public policy and law with an emphasis in applying his love of writing. Ethan is also President of a local collegiate Board Games Club, which includes networking with people from all over the world to strategize on effective techniques that lead to success in the gaming industry. We thank Ethan for all of his hard work!

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