The letter, signed by the organization’s president Salena Pryor, argues that the state’s costly plan to enforce AB 5 would only exacerbate that at this time, when California is facing a massive $54 billion deficit and the state’s unemployment rate is 24 percent, it would be fiscally imprudent to spend $20 million on enforcement of a policy that has been detrimental to the livelihoods of Black small business owners,” the letter reads.

In the wake of worldwide efforts to call out systemic racism, Black business organizations are speaking out against the restrictions that AB 5 has placed on African American entrepreneurs in including the bill’s author Assemblymember Lorena Gonzalez (D-San Diego), say they are open to making adjustments in the law as long as its core purpose, fighting against gig worker misclassification, is kept.

The statement signed by Michael Lawson, President of the Los Angeles Urban League, read, “AB 5, the legislation introduced by Assemblywoman Lorena Gonzalez focuses solely on the employee side of the equation and ignored the impact that this legislation has on Black-owned businesses that have suffered through a history of redlining that allowed banks and other financial institutions to legally discriminate against Black-owned businesses, preventing them from gaining access to capital and credit.”

Though there has been no official study of the impacts of AB 5 on Black owned business, the Center for Responsible Lending found that 95% of businesses owned by African Americans and other people of color were unlikely to receive aid from the Paycheck Protection Program because of a lack of commercial banking relationships.

During the June 11 floor hearing, Assemblymember Kevin Kiley (R-Rocklin) spoke in favor of the amending the bill by reading from the CBCC’s letter, stating plainly the effects of AB 5 on Black businesses.

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Why Small Business Fail.

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