Small businesses are the engines that drive California – and the U.S. – economy. Contrary to popular belief, it is the independents, the small business and minority owned firms that serve as the barometer for the state’s economic prosperity. Fortune 500 companies are definitely important job pillars, to be sure, but 70 percent of new jobs are created by small businesses and many of these businesses lean on relationships with big business to grow and innovate. But let’s be clear, small businesses are leading the charge to economic recovery and fueling California ‘s revenue base. Governor Brown recognized this in designating May as California’s Small Business Month.

It’s critically important that public policies support, rather than hinder, small businesses development. Ninety-nine percent of companies in California are small businesses, and small businesses provide over 52 percent of all private sector jobs.

But the road to success for any small business is far from certain. Two Bounty Hunter Clause Cripples Small Businesses out of every five small business ventures fail after only two years. If the road to success is difficult for the average small business, the statistics are downright sobering among Latino-owned businesses.

Nearly half of all Latino owned businesses fail within four years. Small businesses must overcome a litany of hurdles and obstacles to succeed, but California is home to a unique set of challenges that don’t exist in any of the other 49 states. An example of a challenge that CA small business face during a time of economic uncertainty is Proposition 65, The Safe Drinking Water and Toxic Enforcement Act and the bounty hunter provision of the law which is the enforcement mechanism that affects businesses with ten or more employees.

The bounty hunter provision essentially has turned a handful of trial lawyers in the state into deputized Attorney Generals with the power to engage in what is essentially legalized extortion of small businesses. These lawyers routinely threaten small businesses with expensive lawsuits and strong-arm them into signing outrageously unfair settlements.

Their abuses are well documented in a recent report by the California ‘s Attorney General’s Office. Prop 65 was intended to protect consumers by holding companies that violate environmental laws responsible. But because of the way the law’s enforcement provision was written, a small number of trial lawyers are not only siphoning tens of millions of dollars from many well-intentioned small businesses owners, but also depriving the state of revenue that should be going toward environmental causes.

According to the Attorney General’s office, of nearly 200 private Prop 65 settlements totaling about $14 million, an astounding $8 million went into the hands of lawyers, instead of the state treasury.

Companies that violate the law should be held accountable. But when and if that happens, the state and the environment should benefit, not trial lawyers. Instead, more than half of the monies collected under the auspices of Prop 65 are going to line the pockets of a few wealthy lawyers.

I encourage business owners of all ethnicities to write to California Attorney General Kamala Harris, urging her to amend the bounty hunter provision.

When California residents passed Prop 65 more than 25 years ago, it was to protect the state’s drinking water from toxic chemicals, not to line the pockets of avaricious trial lawyers at the expense of the public and our environment.