Gov. Gavin Newsom (D-CA) was accused of baking in an exception for a big donor this week.
A new California law raises the state’s minimum wage from $16 per hour to $20 per hour, except for restaurants that have an on-site bakery and sell bread as a stand-alone item. That clause appears to do a big favor for Glenn Flynn, who owns dozens of Paneras across California, according to Bloomberg News. Flynn has donated $220,000 to Newsom’s campaigns since 2017.
“Californians deserve answers about Gavin’s crooked PaneraGate deal,” James Gallagher, Assembly Republican Leader, said on X. “Newsom’s got no business lecturing anyone about democracy when he’s using his power to do favors for his special interest donors.”
But Newsom’s office is claiming the exemption has nothing to do with Flynn’s businesses. Panera would not qualify for the exemption as their bread is not made fully on-site, which is the requirement of the exemption. Newsom’s office said Panera mixes their dough off-site and ships it to franchise locations to be baked.
“The Governor never met with Flynn about this bill and this story is absurd,” Newsom spokesman Alex Stack said. “Our legal team has reviewed and it appears Panera is not exempt from the law.”
The clause in the new law came from the “result of countless hours of negotiations with dozens of stakeholders over two years,” according to Newsom’s office, without further explanation for the exemption. Flynn has been involved in other business dealings with the governor in addition to his donations. He said he had no part in the exemption.
Other California Republicans wrote a letter Thursday asking the Attorney General to investigate “Paneragate.”
Former high school classmates, Newsom and Flynn had a business relationship in 2014 when then-Lt. Gov. Newsom reported an undisclosed amount of money from Flynn’s company. Flynn acquired a resort that was managed by Newsom’s hospitality company.
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Flynn Properties and the Flynn Group manage 2,600 restaurants and fitness centers across the country, according to the Hill. In addition to Panera Bread, the Flynn Group includes companies like Applebees, Taco Bell, Wendy’s, and Planet Fitness.
Lawmakers in the Golden State are considering other exemptions to the minimum wage law. The state Senate approved a bill that would exclude fast food restaurants in unique locations such as airports, hotels, theme parks, and museums from being affected by the increase. Workers in these establishments are attempting to negotiate a salary higher than the proposed $20 per hour.
