Two new members join FBA

Two new companies recently joined FBA, the only organization exclusively focused on protecting the interests of family businesses in California

Cobex Construction Company was founded in 2017 by Vazgen Dallakyan, whose family emigrated from Armenia when he was a toddler seeking safety and freedom. The Roseville-based company does residential and commercial roofing, siding, solar, and windows in a 50-mile radius around Roseville. It has 30 employees and is based on the cornerstones of stress-free customer experiences, long-term customer relationships, quality workmanship, and transparency.

TABBA, LLC, is a commercial real estate brokerage in the City of Orange, specializing in Orange County properties. Founded by Allen and Carla Buchanan in 2022, the company has four employees.

 

FBA is lead plaintiff in crucial court case

FBA is the lead plaintiff in a major court case designed to ensure that our members’ free speech rights and ability to support good government in their communities is protected.

The suit seeks to overturn SB 1439, a bill passed with little debate last year that has major implications. Under SB 1439, receiving a $251 campaign contribution would disqualify a local elected official from voting on any issue relating to whomever they received the contribution from - be it an individual or company. This would even apply to newly hired individuals that did not previously work for, or have any affiliation with, the company at the time of their individual contribution.

Making and receiving campaign contributions is an exercise of a constitutional right of free speech.

This law will also have a direct effect on many of our members’ ability to operate and expand their businesses. For example, if a business wants to expand its operations, they often seek zoning changes or conditional use permits that must be approved by the city council or the board of supervisors. Many restaurants operate under conditional use permits. And farmers and ranchers almost always require special use permits for activities such as agricultural processing facilities. These can be controversial even though the zoning permits them, so elected officials often have to make the final decision.

Accordingly, it would be risky for any family business owner to ever contribute to candidates for local office because it’s always possible that six or eight months down the road an issue will come up that would require elected officials to be involved.

It would also have a chilling effect on many family businesses that you wouldn’t think would be affected. Businesses that do engineering, accounting, legal and other work in the development sector may find themselves cut off from future work if they make contributions to local elected officials. Because their contributions, no matter how small, would be considered part of a prime contractor’s aggregated contributions, the contractor might have to bar them from future work simply because they exercised their constitutional rights.

FBA has joined with several influential business associations to seek to overturn this poorly thought-out law. You can read our joint memo to the Legislature here.

You can read news articles about the suit in CalMatters, the Sacramento Bee, the Orange County Register, and the San Joaquin Valley Sun.

Breault Asphalt Maintenance joins FBA

FBA is pleased to announce that Breault Asphalt Maintenance has joined the Association. The company was founded in 2004 in Sacramento by siblings Jim Breault and Katie Little and operates in Northern California and Nevada with 13 employees. The company specializes in asphalt repair, sealcoating, parking lot striping, ADA upgrades, and concrete repair for commercial properties.

Welcome new member Universal Custom Display

FBA is pleased to welcome Universal Custom Display as a new member company.

UCD is a premier retail, grocery, commercial, and residential manufacturer for some of the largest organizations in the world. From turning creative retail concepts into prototypes, to cost-effectively executing full-scale retail rollouts, UCD delivers flexible solutions at every stage of the process. The company was founded in 1999 by Daniel Hayes and his son is now very involved in the management of the company. They are located in Elk Grove and have 105 employees.

PAGA amicus brief filed with the California Supreme Court

Californians for Fair Pay and Employer Accountability, the “Stop Small Business Shakedowns” committee, was established to find solutions for reforming the state’s Private Attorneys General Act (PAGA), either in the Legislature, through the courts, or on the ballot. The committee has filed an amicus brief at the California Supreme Court in the case Adolph v. Uber Technologies, LLC. FBA and other coalition members – prominent statewide associations – are deeply concerned that an overly broad interpretation of PAGA in this case would deal yet another blow to California companies already struggling to survive under the threat of PAGA lawsuits. A broad ruling could go beyond the Legislature’s intent and would not provide any meaningful benefit for California employees. It would, however, increase extortion opportunities for trial lawyers who look to leverage technical errors where there has been no harm to employees. Combating the widespread abuse of PAGA is a top priority of FBA.

10 years of keeping family businesses at the table and off the menu

The Family Business Association of California is celebrating its 10th anniversary this year. While that may not be a record for longevity compared to many of the highly effective trade associations that have advocated on behalf of large and small businesses in California for decades, it is unique in that the FBA is the only organization that solely represents family businesses that have operated in California for as many as 100 years or more.

Too often, the interests of California’s estimated 1.4 million family-owned businesses – a critically important and large sector of California’s economy – were not considered as state officials made decisions about taxes, laws and regulations affecting the business community. Too often, as the old political saying goes, because family businesses weren’t at the table when these decisions were being made, we were on the menu. That’s especially true when it comes to perhaps our top priority – the need to keep our businesses family-owned from generation to generation.

The primary difference between family businesses in California and other businesses is our desire to stay in California, provide stable employment, participate in our local economies and take the long view of success. Family businesses are not bound by driving quarterly results but instead are generally focused on long-term financial success, satisfied customers and engaged employees. However, bills passed by the Legislature often do more harm than good to those many family businesses committed to our communities.

During its decade of working to promote family businesses in California, FBA has achieved a number of significant accomplishments, including:

  • Killing legislation to create a new inheritance tax that would have inhibited the passing of family businesses to the next generation.
  • Introducing legislation to add a definition of family business to state law.
  • Stopping proposals to limit how families move assets.
  • And helping defeat the “split-roll” property tax initiative and “single-payer” health care proposal, both of which would have cost our members billions of dollars per year.

These victories were important because the success and continuation of family businesses are essential to our state’s future prosperity. Studies have shown that nationally, family businesses generate 57% of the nation’s GDP, employ 63% of the workforce and create 75% of all new jobs.

Furthermore, in addition to our economic impact, family businesses serve as the foundation for our communities. Studies show that we engage in higher levels of philanthropic giving, donate more to local causes and have better records of environmental stewardship than businesses as a whole. In addition, we tend to invest more in our employees’ training and benefits, are more likely to promote women to executive management and are less likely to lay off workers in tough economic times.

Unfortunately, our elected officials and regulators need to be working to make it easier, not harder, for these essential companies to grow and thrive. Too often, however, that is not the case. Over 2,000 bills were introduced during the most recent legislative session and, according to CalTax, those with a fiscal impact would have imposed more than $198.9 billion a year in higher taxes and fees. As the 2023 session draws near, the state is looking at a projected $25 billion budget deficit that would grow much larger if the state and nation enters a recession. It is inevitable that many lawmakers will seek to increase taxes and add more regulations.

It is well documented that these taxes and regulations drive many businesses out of California leaving the deeply rooted family businesses of California as an even more important foundation for supporting our local economies. However, while it is becoming more difficult for us to successfully operate, many legislators seem to think that we will always be here no matter what they do, making profits that can be taxed.

So FBA will continue working with partners in the business community and with business-friendly legislators from both parties who understand that adding more and more complex and expensive requirements will only further damage our economy and our quality of life.

And that’s why FBA will ensure that family businesses remain at the table, and not on the menu, in Sacramento

Monroe is president of Holt of California and Chairman of the Family Business Association.