Re-regulating Markets is No Solution to State Housing Crisis

house-constructionBy almost all accounts, economists, academicians, social scientists, policy makers and industry experts agree that at the root of California’s housing problems is a profound lack of supply.  Accordingly, what’s needed as a solution, these notables say, are more incentives for the private development sector to do what it does best:  build.

However, judging from the bills coming out of the state Legislature, lawmakers – all of whom have well-advertised bills to “solve” the state’s housing crunch – don’t seem to have a clue, particularly in the state Assembly.  They want more control, more power, more government.

Take AB 1506 (Bloom), for example.  Before it was withdrawn for lack of support, AB 1506 would have ushered in to California a well-documented policy scam:  rent control.  Rent control has failed everywhere it’s been tried.  It persists, in communities like Manhattan and Los Angeles where it’s been around long enough to become normal but where the mismatch between incomes and rent is profound. 

What rent control has done is to artificially hold housing prices down.  But, what it has also done is to discourage investment in housing by limiting what an individual can earn on his or her investment.  Moreover, by limiting the income one can recoup from renters, rent control has led to more and more properties falling into disrepair as maintenance and other property improvements are further deferred.

Another Assembly offering, AB 1521 (Bloom), actually passed the lower house.  AB 1521 would give an individual the first right of refusal to purchase a rental property thereby limiting the price and extinguishing market forces.  More government control.

The Assembly also said yes to AB 1505 (Bloom), which for the first time in California, says that market-rate housing can’t be built in the state until an “affordable housing” component is provided.  This requirement means a newly built market-rate home or apartment must be severely discounted to prices or rents well below the market, regardless of what it cost to build – leading to higher-priced housing overall, as builders try to make up the difference.

Meanwhile, the state Senate believes it has the problem licked – boasting in a recent press release:  “Senate Passes Package of Bills to Address California Housing Crisis”.  The Senate package contains lots of legislation – mostly toothless tigers.  But, a centerpiece of that reform package contains SB 277 (Bradford) – the Senate mirror to AB 1505.  It, like its Assembly twin, means local governments can demand deep discounts before new housing is approved.

(Imagine being a homeowner and being told by government that you have to lower your price before you can sell your house.  Yet, that’s essentially what both AB 1505 and SB 277 do.)

But, the latest re-regulation initiative may be coming from the local level of government.  Los Angeles County supervisor Sheila Kuehl – no friend of housing during her 14 years in the state Legislature – recently admonished her colleagues, on the Board and elsewhere, and called for more governmental regulation of housing:

“I want to challenge my colleagues at all levels of government to squarely face the realities of our housing market” Kuehl said.  “For far too long policymakers nationally, in the state, and locally have prioritized real estate profit over a healthy housing market.  Weak housing and rent control regulation combined with shortsighted land use planning has turned L.A. County into the most unaffordable place to live in the entire country.”

In the past, Kuehl has called for county-wide rent control, even though the ordinances in the Cities of Los Angeles, Santa Monica and West Hollywood have helped bring about the current housing shortage plaguing the region.

California already has the most substantial housing regulations in the nation.  If you want to build here, prepare for five to seven years – and several thousands of dollars per unit – being added to your plans before they are approved.  If you want to rent out your property, the government’s going to tell you what pets to admit and for whom, whether or not your tenants can smoke, when a tenant can vacate the apartment, whether or not your property is a nuisance and what will remedy the situation, what pesticides you can use both inside and outside rental units and, in some jurisdictions, what rents you can charge.  And, that’s just for starters.  More government, more control.

Rome is burning – and what your state and local lawmakers are proposing to put the fire out is more of the same.

onsultant specializing in housing issues.

This piece was originally published by Fox and Hounds Daily

California Budget: Balanced and progressive or out of control?

Jerry Brown Budget 2017SACRAMENTO – The California Assembly and Senate have until Thursday to approve the budget deal announced by Gov. Jerry Brown last week, but there’s little uncertainty about the outcome. The general-fund budget is a record-setting $125 billion – something Brown describes as “balanced and progressive,” given that it spends more on social programs, but doesn’t bust the bank.

In fact, the budget plan conforms almost exactly to the governor’s longtime fiscal approach. He wants to fund social programs as much as possible, but not create new, permanent spending programs that cannot be curtailed when fiscal times are bad. He talks repeatedly about frugality, yet his budgets continue to ramp up state spending to record levels. He did set aside $8.5 billion for the rainy-day fund to prepare for any downturn.

Even the governor’s approach to the state’s unfunded pension liabilities is prototypical Brown. The governor speaks regularly about the size of the state debt to pay for pensions and retiree medical programs, but he typically addresses the problem with small-scale solutions that trim debt levels without antagonizing state workers and the unions that represent them.

This particular deal would borrow money from a state fund that pays a low interest rate, and pay down some of the state’s pension debt by investing it with the California Public Employees’ Retirement System, which predicts a fairly high rate of return (7 percent). Brown says this plan will save the state $11 billion over the next two decades simply because of the difference in interest rates.

In terms of spending, the budget uses $1.2 billion in new revenues from the state’s recently passed tax increase on tobacco to help pay for growing costs to Medi-Cal, the state health program for low-income residents. But about half of those new revenues will be earmarked to health care providers and to family-planning entities like Planned Parenthood. It expands spending on the state’s K-14 educational system.

The budget also expands spending for both of the state’s university systems (the University of California and California State University), but the nearly $300 million combined in increased higher education spending comes with some conditions. The plan withholds $50 million from the University of California until the Office of the President fulfills the recommendations made earlier this year by a state auditor. It also requires California State University officials to “find space for students denied entry to their preferred campus or program,” according to the Sacramento Bee.

The budget increases spending on subsidized affordable-housing programs by $400 million. The budget also will allow more people to take advantage of the state-level Earned Income Tax Credit. Under new criteria, low-income people earning up to $22,000 a year will qualify for state EITC payments, up nearly $8,000 from previous standards. The new eligibility standards also apply to people who work for ridesharing companies or are involved in other forms of self-employment, according to various news sources. The budget doesn’t include an extension of the cap-and-trade system, although the system is likely to be extended in separate legislation.

Furthermore, the budget spends $100 million to set up a new agency to deal with the legalization of recreational marijuana sales, including the creation of a tax office along the Redwood Coast in the heart of marijuana-growing country.

The whole budget, which includes all spending (from bonds, etc.) totals $183.2 billion. But the biggest controversies are not around the amount of money the state will spend. The Legislature used the trailer-bill process – normally reserved for technical amendments to budget matters – to pass some controversial, nonbudget-related matters.

For instance, Democrats are fighting a recall measure against state Sen. Josh Newman of Fullerton. Republicans targeted him because of his vote on the recently passed gas-tax increase. One trailer bill in the budget would extend the timelines for the recall, making it more likely that the election would be put on a regularly scheduled ballot timeframe that would be more favorable to the Democratic incumbent. Another trailer bill would reduce the power of elected officials in the state Board of Equalization, a tax board. Yet another creates new dam-safety rules, following problems at the Oroville Dam spillway last winter.

Still, what Democrats described as responsible drew some rebuke from Republicans, who note that general-fund spending is nearly $40 billion higher in this budget than it was six years ago. Balanced and progressive or out of control? It depends on which side of the aisle one sits on. But everyone at least agrees that it’s basically in balance.

Steven Greenhut is Western region director for the R Street Institute. Write to him at sgreenhut@rstreet.org.

This article was originally published by CalWatchdog.com

Republican joins 2018 race for California governor

As reported by the Fresno Bee:

Assemblyman Travis Allen is the sixth candidate — and second Republican — to jump into California’s 2018 gubernatorial contest.

The candidates hoping to replace Democratic Gov. Jerry Brown are:

—Lt. Gov. Gavin Newsom, a Democrat. Newsom announced his bid to succeed Brown early, in 2015. He was elected lieutenant governor in 2010 after serving as San Francisco’s mayor.

—Antonio Villaraigosa, a Democrat. Villaraigosa is a former mayor of Los Angeles, the first Latino to hold the post in more than a century.

—State Treasurer John Chiang, a Democrat. Chiang serves as the state treasurer and would be California’s first Asian-American governor.

—Delaine Eastin, a Democrat. Eastin is the former state superintendent of public instruction, leading California’s public school system from 1995 to 2003.

—John Cox, a Republican. Cox is a San Diego-based businessman with experience in real estate management and investment firms. He’s already dumped $3 million of his own money into the race. He previously made an unsuccessful run for Congress in Illinois.

—Travis Allen, a Republican. Allen is a three-term assemblyman from Huntington Beach. He’s heading a ballot initiative to repeal a gas tax increase passed by mostly Democratic lawmakers earlier this year.

Democrats Talk Openly About Challenging Nancy Pelosi’s Leadership

Nancy-Pelois-denied-CommunionHouse Minority Leader Nancy Pelosi (D-CA) is facing unprecedented pressure, as frustrated Democrats have begun — for the first time in seven years — to talk about replacing her after a series of disappointments at the ballot box.

Pelosi was hailed as a driving force behind Democrats’ victory in 2006, when the party seized both houses of Congress and set the stage for victory in the 2008 presidential election. She became the first female Speaker of the House, and set about centralizing power in the Speaker’s office, ruling her caucus with unquestioned authority and promoting an unapologetically liberal agenda.

However, Pelosi’s role in the Obamacare debacle of 2009-10 helped provoke the Tea Party wave, sending her party to historic defeat and costing her the Speaker’s gavel. Amazingly, Pelosi did not resign at that point, and dispatched several would-be challengers, most notably Rep. Heath Shuler (D-NC), who later lost his seat to a Republican. She also fended off a challenge by Rep. Tim Ryan (D-OH) after 2016. Pelosi has been a prolific fundraiser for the party, even if she has also become a lightning rod for criticism and a useful political foil for Republicans to run against.

Ironically, Pelosi’s power within her caucus only grew as the Democrats lost seats, because most of the losses were in conservative swing districts. That left a core of liberal representatives from major cities, and blue states such as New York, Illinois, and Pelosi’s home state of California. There has been no political constituency in the caucus for an ideological alternative to the left-wing agenda that Pelosi and her coterie have continued to push even in defeat.

The high expectations that Pelosi set for Tuesday’s special election in Georgia may prove to be her undoing. Early in the week, with Jon Ossoff expected to win, Pelosi let it be known that she expected to take back the Speaker’s gavel after 2018. But Republican Karen Handel surged to victory, partly by tying her opponent to Pelosi.

As reality hit home, some Democrats began to break the taboo around challenging their leader. MSNBC analyst Matthew A. Miller tweeted: “No Dem wants to say it publicly, but taking their top bogeyman Pelosi off the table would help too. Fair or not, it’s the truth.”

Now, other critics are beginning to emerge.

“It’s time for some change. I think it’s time for a new generation of leadership,” said Rep. Seth Moulton (D-MA). And Rep Filemon Vela (D-TX) told Politico: “I think you’d have to be an idiot to think we could win the House with Pelosi at the top … Nancy Pelosi is not the only reason that Ossoff lost. But she certainly is one of the reasons.”

But Pelosi also has her defenders — and she will not go easily.

Joel B. Pollak is Senior Editor-at-Large at Breitbart News. He was named one of the “most influential” people in news media in 2016. He is the co-author of How Trump Won: The Inside Story of a Revolution, is available from Regnery. Follow him on Twitter at @joelpollak.

This piece was originally published by Breitbart.com/California

Void in Leadership Continues for California High-Speed Rail

High Speed RailFour months after then-California High Speed Rail Authority Chief Executive Jeff Morales told authority board members he was moving on and two months after Morales made his decision public, the agency overseeing the state’s $64 billion bullet train project hasn’t settled on his successor.

In 2012, four months after Chief Executive Roelof van Ark abruptly left following two stormy years, Morales already had the job. This time around, the same speedy selection process seemed likely. The RT&S transportation industry website reported after Morales’ decision was announced in April that the board was likely to have his replacement approved before Morales’ final day of June 2.

But the CHSRA board met in closed session on the succession issue on May 10 and June 14 without reaching a decision. The rail agency’s number two job – deputy chief executive – has also been vacant since Dennis Trujillo left in December.

The empty slots atop the CHSRA power structure come at a critical time.

According to a federal report prepared under the Obama administration, the state’s high-speed rail project is already seven years behind schedule and on its way to having a 50 percent cost overrun on the $6.4 billion, 118-mile first segment now being built in the Central Valley.

The project also continues to face legal challenges which argue that it violates the terms of Proposition 1A, the 2008 ballot measure providing $9.95 billion in bond seed money for the project. The rail authority has won most recent judgments. But opponents remain confident they eventually will prevail because of a 2014 state appellate court ruling that held the project still was subject to a financial “straitjacket” that would require it to show short- and long-term financial viability without public subsidies before the project could significantly proceed. The project’s struggle to attract private investment shows that at least in the private sector, there are many doubts that the bullet train could operate successfully without such subsidies.

Obama administration rules could haunt project

But the election of Donald Trump as president in November also has led to a huge new headache for CHSRA. All 14 California House Republicans have urged Transportation Secretary Elaine Chao to reverse Obama administration actions that loosened federal rules to give California access to about $3 billion in federal dollars for the project.

Rep. Jeff Dunman, R-Turlock, and his colleagues have focused their harshest fire on a 2012 decision that gave the state the go-ahead to spend about $200 million in federal funds but not have matching state spending. The decision went against longstanding Washington precedent.

Withdrawing all federal funding could also be justified by citing the Obama administration’s 2009 regulations for projects that were to be paid for or partly paid for with money from the economic stimulus bill passed a month after President Obama took office. The Federal Railroad Administration rules said projects that didn’t demonstrate “reasonableness of financial estimates” and “quality of planning process” would get no funding.

That’s the same agency which recently concluded the project was seven years behind schedule and on course for a 50 percent cost overrun on its initial segment

The California High Speed Rail Authority board’s next meeting is July 18 in Sacramento.

This article was originally published by CalWatchdog.com

Updated Legislative Priorities for Small Business Advocates

CA-legislatureFollowing the annual legislative house of origin deadline, NFIB California reflected on our victories and challenges ahead with our “The Good, The Bad, & The Ugly” bill list. Each year we proactively identify which bills will have the greatest impact, either negative or positive, to our 22,000 small businesses across California. Throughout the year we advocate in the Capitol for these priorities in order to lower the burden and cost of doing business in this state.

It is now halftime in the Legislature, and with that comes some welcome victories for small business, but more importantly there remain significant challenges ahead in these final months of this legislative session. With this being the first year in the 2017-18 two-year session, it is important to remember nothing is ever truly dead, but below are some highlights of where small business stands at legislative halftime.

Victories:

Good Bills Passed

AB 657 (Cunningham): Requires state agencies that significantly impact small businesses to display the name and contact information of the small business liaison on the agency’s Web site, and to fill any vacancy in this position within 3 months. Passed out of Assembly, in Senate Appropriations.

AB 816 (Kiley): Requires public California Environmental Protection Agency meetings, including subordinate departments like CARB and OEHHA, to be broadcast online and interactive to the public. It also requires them to be recorded for future access. Passed out of the Assembly, in Senate Rules.

Bad Bills Stopped

AB 5 (Gonzalez-Fletcher): Requires employers with 10 or more total employees to offer more hours to their part-time employees before they can hire new workers, including temporary or seasonal staff. It creates a new right to sue your employer if you don’t get more hours. Held in Assembly Appropriations.

AB 43 (Thurmond): Imposes a 10% tax on businesses that contract with CDCR for the “privilege” of having a state contract in order to fund education programs designed to discourage future criminals. It sets a bad precedent by taxing businesses just for having a state contract. Held in Assembly Appropriations.

SB 300 (Monning): Requires all sugar-sweetened beverages sold in California to have a health warning label, and creates new civil penalties for failure to do so. This is yet another example of nanny government. Held in Senate Health.

Challenges Ahead:

Needs to Pass

AB 12 (Cooley): Requires all agencies to do a full review of their regulations to see if they are outdated, too costly, or overlap with other rules. Such a full-scale review has not happened in decades. Held in Assembly Appropriations.

AB 77 (Fong): Requires legislative approval for any regulations with an economic impact of over $50 million. Held in Assembly Appropriations.

AB 281/AB 1429/AB 1430: Create desperately needed PAGA reforms, including extending the timeframe in which a business can cure a problem before being sued, limiting the types of PAGA suits, and requiring an agency investigation before suing.

AB 1005 (Calderon): The Department of Consumer Affairs oversees the licensure of businesses and professions. This bill would allow 30 days for abatement of the violation before the administrative fine becomes effective. Held in Assembly Appropriations.

Need to Stop

AB 1008 (McCarty): Prohibits employers from asking applicants about convictions until they make a conditional offer of employment. It creates new obligations and liabilities for employers and allows for new lawsuits. It will hamstring a small business owner’s ability to quickly fill a position. Passed out of the Assembly, in Senate Rules.

SB 2 (Atkins): Creates a new $75-$225 per document fee (or tax) for the transfer of real property to fund affordable housing programs. Held on the Senate Floor.

SB 562 (Lara): Creates fiscally reckless single-payer healthcare system in California. This would cost $400-500 billion annually, and would require enormous tax increases to fund. It would hurt the quality of healthcare for our citizens. Passed out of the Senate, in Assembly Rules.

SB 640 (Hertzberg): An intent bill that will expand the state sales tax to services. Small businesses would have to collect a new tax, and also pay the tax when they contract out for services. Held in Senate Governance & Finance.

Tom Scott is CA Executive Director, National Federation of Independent Business.

This article was originally published by Fox and Hounds Daily

Democrats Embrace Banana-Republic Tactics

California’s Democrats control just about everything in the state. They own every statewide constitutional office and have supermajorities in both houses of the Legislature. Heck, a news report this week revealed that Republicans have a majority of voters in only 14 of the state’s 482 cities. In other words, the majority party can pretty much do as it pleases wherever it chooses.

Yet the usually hapless Republican opposition has managed to inspire enough fear in the majority party that Democrats have resorted to the kind of cheating one would expect in some third-world backwater.

As this column has explained, one of the state’s savviest GOP officials, former San Diego councilman Carl DeMaio, is leading a recall campaign against a Democratic senator, Josh Newman, who represents a GOP-leaning district in Orange and Los Angeles counties. The recall has legs because Newman cast a deciding vote on a massive increase in the gasoline tax and the state’s vehicle-license fees — something that will cost many Californians hundreds of dollars a year. (The roads here need help, but state leaders are too busy spending money on other priorities.)

Recall advocates seem likely to succeed at picking off this freshman senator, given widespread anger — even among many Democrats — at the tax hike. Losing Newman will mean that Democrats lose their legislative supermajority. In California, supermajorities are needed to pass every manner of tax increase. Furthermore, DeMaio and company have plans to use the latest tax hike to target other vulnerable legislators in other districts.

Candidate for the US Senate Josh Newman speaks with supporters at his campaign rally Tuesday at Yardhouse in Brea.  - ADDITIONAL INFO/// - ROD VEAL/CONTRIBUTING PHOTOGRAPHER - 110916.Elex.Senate29 - 11/8/16 -  Candidate for the US Senate Josh Newman hangs out at his campaign rally Tuesday at Yardhouse in Brea.

State Senator Josh Newman

So far, we’ve seen the expected pushback — a particularly ugly hit mailer by Newman backers, and a tsunami of support from the majority party and from liberal interest groups. That’s politics as usual, but the latest gambit is particularly outrageous: Legislative leaders are pushing through a bill that would change the rules of the game for recall elections to assure that Newman can survive this challenge.

“The proposed changes, which became public Monday morning, would add months to the existing timeline of certifying a recall election for the ballot,” according to a Sacramento Bee report. “The measure would virtually assure that any recall election would be held at the regularly scheduled June 5, 2018 legislative primary election.”

DeMaio and company are playing by existing rules, which would require the governor to schedule a recall election 60 to 80 days after the secretary of state certifies the number of signatures. They want to strike while the iron — or at least voter anger — is still red hot. They’re planning to hold the election shortly after gas prices go into effect. It’s a great strategy, especially given the large number of signatures recall backers already have submitted for verification.

But few expected Democrats to resort to this strategy. Senate Bill 96 and Assembly Bill 112 have been rammed through the Legislature as trailer bills — last-minute technical measures that are supposed to be reserved for budget issues. It’s a way for them to pass bills without the normal hearing process and legislative vetting.

For instance, the current analysis of S.B. 96 says that “this bill expresses the intent of the Legislature to enact statutory changes relating to the Budget Act of 2017.” But that language has been stripped out and the new, controversial non-budget-related language is inserted.

The bills will delay the signature-gathering process long enough to allow the governor to consolidate the recall election on the June primary ballot. That will give time for voter anger to smolder, and primary elections draw a much larger turnout. In this state, that means that far more Democrats will turn out, and the likelihood of the recall succeeding would be much slimmer.

Here’s the Bee again: “It would give voters who signed the petitions up to 30 days to withdraw their signatures, with county election officials reporting withdrawn signatures every 10 days. If there were still enough signatures to qualify the measure, the Department of Finance would have to issue a cost estimate for the election. Then the Joint Legislative Budget Committee would have 30 days to review and comment on the department’s cost estimate.”

The justifications for this rules-rigging are almost as outrageous as the legislation itself. Legislative leaders are upset that recall supporters tie the recall to a possible rollback in the gas-tax hike. Since when do legislators scuttle a long-established democratic process simply because they might not like the argument the other side may be using?

The idea that voters are being misled and need a chance to withdraw their signatures is condescending. I’d have more respect for the state’s majority party if its officials simply dispensed with these arguments and admitted that they simply are flexing their political muscle.

By the way, it’s a legitimate goal of the recall to get rid of Newman as a way to build political pressure for the Legislature to overturn the gas tax hike. One of the key reasons for recalling Democratic Gov. Gray Davis in 2003 was his support for a tripling of the vehicle-license fee. One of the first acts of his replacement, Arnold Schwarzenegger, was a rollback of the fee hike.

“Recalls are designed to be extraordinary events in response to extraordinary circumstances — and it’s in the public’s overwhelming interest to ensure the security, integrity and legitimacy of the qualification process,” said a spokesman for Senate President Pro Tempore Kevin De Leon, D-Los Angeles, to a Los Angeles Times reporter. So now the official argument is that they don’t like the reason for the recall. And they’re doing this for the public’s interest, of course. DeMaio has threatened legal action, but this whole thing could further delay the election.

This isn’t the first time the state’s Democrats have rigged the rules for crass political purposes. Another Bee article noted that this has become rather common. For instance, it noted that in 2011 they passed a law requiring all voter-backed initiatives (as opposed to the ones put on the ballot by legislators) to appear on the November general-election ballot given that conservative-oriented initiatives have a tougher time on these high-turnout dates.

They also passed in 2012 a bill changing the order in which initiatives appear on the ballot with the obvious goal of making it more likely for the governor’s tax increase to appear first — and thus be more likely to get a “yes” vote.

And I wrote for the Spectator last week about the Assembly speaker’s decision to, apparently, just ignore the clear intent of a recently passed voter initiative that requires a 72-hour notice before a vote on all final versions of every bill. That good-government measure was supposed to stop the Legislature from sneaking through gut-and-amend bills without giving legislators, the media, and the public an opportunity to see what’s in them. The Assembly offered an alternative reading of the measure as a transparent way to get around it.

Meanwhile, I also wrote for the Spectator about how Democratic legislators are rewriting some county redistricting rules as a brazen way to flip some Republican supervisorial districts to the Democrats — something so heavy-handed that even Democratic officials in Los Angeles County objected.

Perhaps, this is what one can expect in a one-party state, but it certainly makes a mockery of the notion of democracy. But the latest ploy is particularly disturbing. If Gov. Jerry Brown signs the anti-recall measure, we can at least dispense with the niceties. At that point, it will be official and California will join the ranks of banana republics.

This piece was originally published by the American Spectator

CA Budget & Fiscal Policy is Unsustainable

May Revise 2017While the governor’s leadership has been the key to keeping California in the black and paying down debt, the Legislature continues to grow permanent spending based on an increasingly volatile revenue stream. The Legislature’s highest priority for environmental policy is sustainability. Yet today their highest priority for budget and fiscal policy is unsustainability.

Since the economic recovery began in 2010, taxpayers and the business community have grown the General Fund by $41 billion and special funds by $28 billion, representing an overall revenue increase of $69 billion or 63 percent. In addition, we have also grown local property tax revenues for Prop. 98 more than $10 billion, which is equal to a 72 percent increase.

While California is already the highest taxed state in the nation, the Legislature introduced bills to authorize more than $370 billion in new taxes and fees in 2017 — more than double the state revenues contained in the budget bill.  For example:

  • During this same period in 2017, state funding for K-12 education is set to grow $17 billion, or roughly 50 percent, while state employee pension and health benefit payments are set to nearly double to more than $14 billion.
  • There also is considerable growth in spending for health care and social services expansion.  Since 2009-10, Medi-Cal spending has increased by $9 billion in the General Fund and by $64 billion in state and federal funds.  California is committed, even under existing federal law, to picking up an increasing share of the federal portion.
  • In 2022, the hastily approved minimum wage increase of 2015 will be at full implementation, impacting General Fund costs by $3 billion and all funds by $10 billion.
  • The series of labor agreements approved this year-to-date commit the state to another $4 billion in permanent spending increases.

The passage of these spending priorities required the state to pass $5 billion in new taxes to fund critically needed road and infrastructure repair. Now it is time to prioritize major structural reforms that create long-term economic stability before another recession occurs, the impacts of which could be even more devastating than what we witnessed during the economic downturns in either 2001 or 2008. We must work towards a budget that better protects all Californians and our economy for our long-term future.

resident, California Business Roundtable

This piece was originally published by Fox and Hounds Daily

CA Secretary of State denies NSA report of 2016 election hack

vote count electionWho will Californians believe: Secretary of State Alex Padilla or the National Security Agency?

That’s one way to boil down a flap that’s emerged this week over the sanctity of California’s 2016 elections.

Beginning shortly after November’s election, Padilla has pushed back hard at any claims of voting irregularities in the nation’s largest state. The former Democratic state senator representing part of Los Angeles – elected in 2014 to be the state’s chief elections officer – was most irked with President-elect Donald Trump’s claims that he would have won the popular vote if not for massive voter fraud in California and other states. On Jan. 25, soon after taking office, Trump repeated his claims and again specifically alleged problems in California.

Padilla called that a “flat-out lie.” He said his office reached out to Trump aides asking them to provide evidence for his claims and never heard back. In a press release issued then, Padilla said Trump’s leveling of harsh allegations without having a case is “frankly dangerous to people’s faith in our democratic system.”

In May, after Trump aides announced the creation of the Presidential Advisory Commission on Election Integrity, Padilla again responded with outrage.

“The commission’s mandate is deeply flawed and its motives suspect,” the secretary of state said in a statement. “The only purpose this commission serves is to distract from critical investigations of Russian interference in the 2016 election. And I fear that it will serve as pretext for the administration’s efforts to roll back the voting rights so many fought so hard to obtain.”

But Padilla has also flatly rejected the idea that Russian operatives or operatives from any nation “hacked” any of the state’s election systems.

Bloomberg News: California election contractor was infiltrated

Yet early Tuesday, citing a classified NSA report obtained and released by The Intercept, Bloomberg News reported that “Russia’s cyberattack on the U.S. electoral system before Donald Trump’s election was far more widespread than has been publicly revealed, including incursions into voter databases and software systems in almost twice as many states as previously reported.”

U.S. intelligence agencies investigating a hack targeting Illinois election operations found telltale evidence that enabled them to uncover similar attempts to infiltrate voting systems elsewhere.

“Thirty-seven states reported finding traces of the hackers in various systems, according to one of the people familiar with the probe,” Bloomberg reported. “In two others – Florida and California – those traces were found in systems run by a private contractor managing critical election systems.” In Florida, Bloomberg wrote, another leak had established the contractor was VR Systems.

In response, Padilla’s office issued a statement that suggested the NSA report was based on outdated information.

“There is no evidence of any breach of elections systems in California. VR Systems, which is headquartered in Florida, does not provide services to the secretary of state,” Padilla said. His statement asserted that while VR Systems once provided some election services to Humboldt County, it was not involved in tabulating votes in California in 2016.

Separately, KPCC – the Pasadena-Los Angeles National Public Radio affiliate – reported that it had contacted election officials in the counties of Los Angeles, San Diego, Orange, Riverside and Ventura, and all denied knowledge of having been hacked.

Meanwhile, there’s been little news on what Trump’s Presidential Advisory Commission on Election Integrity has done to investigate the president’s claims. The order creating the commission contained no timetable for it to issue interim findings or a full report.

This article was originally published by CalWatchdog.com

Film Crew Accused of Baiting Sharks in Southern California

SharkMaritime authorities intervened to stop a National Geographic crew from baiting sharks off the coast of Long Beach in the midst of a local panic about great white sharks appearing near the shore, according to a local news report.

The Orange County Register reported Wednesday that “officials suspect that some media outlets aren’t satisfied with footage of naturally occurring shark sightings.” It elaborated:

Long Beach lifeguard officials say they strongly suspect film crews are throwing fish or bait in the water near shore to attract sharks, also known as “chumming.”

“We’ve gotten some reports from citizens who have seen recreational boats out chumming,” Gonzalo Medina, Marine Safety chief, said. “Some fishing boats too. They’re trying to get video footage of the sharks.

Some film crews are reportedly chumming within 100 yards of the shore. One official told the Register that authorities had stopped a National Geographic film crew: “We had a crew from National Geographic. … We talked with them, and they were very receptive. Ultimately, they used rubber fish attached to a line that they could pull back in.” The crew was not issued a citation, the Register reports.

In late April, a woman was attacked and severely injured by a great white shark while swimming at San Onofre State Beach in Orange County.

Since then, great white sharks have been spotted near the shore in Orange County and in Long Beach. Though it is not rare to see juvenile great whites in Southern California waters, it is unusual to see mature sharks, especially near the shore.

The news reports have frightened many swimmers and surfers as the summer season begins.

Now, it seems, media companies may be chumming the waters to create the very news they hope to report.

Joel B. Pollak is Senior Editor-at-Large at Breitbart News. He was named one of the “most influential” people in news media in 2016. He is the co-author of How Trump Won: The Inside Story of a Revolution, is available from Regnery. Follow him on Twitter at @joelpollak.

This piece was originally published by Breitbart.com/California