Why don't they force the breeders to have better conditions for the animals, and include livestock and lab animals along with it?
By doing it this way they aren't acknowledging there is a demand for certain breeds of dogs unlikely to be found at a shelter. The market is going to find a way around this, either by dealing with the dealers' directly (or through some sort of "finder") or going out of state.
Either way, the poor conditions for animals are going to continue in some shape or form, and no one is going to be able to set up a breeder farm that treats its animals ethically without finding a way to sell their animals, which means jumping through yet another hoop.
It's just dumb, kind of insulting to the voters, and I suspect the politicians for this were intending to avoid taking the heavy donors of the farming/pharmaceutical industries to task while still trying to cast themselves in a progressive light.