Pasquale Talarico

California Looks to Spend Some Medicaid Money on Housing

March 28, 2023 By Adam Beam 2 Comments

At the start of 2022, Thomas Marshall weighed 311 pounds. He had been hospitalized 10 times in five years, including six surgeries. He had an open wound on his left leg that refused to heal — made worse by living in a dirty, moldy house with five other people, two ball pythons, four Chihuahuas and a cage full of rats.

More than a year later, Marshall has lost nearly 100 pounds. His wound has healed. His blood pressure has returned to normal levels. His foot, which had nerve damage, has improved to the point he goes on regular walks to the park.

Lots of factors are at play in Marshall’s dramatic turnaround, but the one he credits the most is finally having stable housing, after the nonprofit Sacramento Covered helped him get a one-bedroom, 500 square-foot (46.4-square-meter) apartment in a downtown high rise. He has hardwood floors, white pine cabinets and a glass jar on the counter filled with Bit-O-Honeys.

“To me it’s the most important 500 square feet I’ve ever had,” he said. “Living here has just improved my well-being in every possible way.”

Marshall’s story is part of a radical rethinking of the relationship between housing and health care in the U.S. For decades, Medicaid, the joint state and federal health insurance program for people with disabilities or low incomes, would only pay for medical expenses. But last year the Biden administration gave Arizona and Oregon permission to use Medicaid money for housing — a nod to reams of research showing people in stable housing are healthier.

Now California wants to join those states, building on the success of programs like the one that got Marshall housing. Gov. Gavin Newsom has proposed spending more than $100 million per year in the state’s Medicaid program to pay for up to six months of housing for people who are or risk becoming homeless; are coming out of prison or foster care; or are at risk for hospitalization or emergency room visits.

It would be the biggest test yet of using Medicaid money for housing. California has the nation’s largest Medicaid program, with more than 13 million patients — or about a third of the state’s population. California also has nearly a third of the nation’s homeless population, according to federal data.

“It’s a huge step toward breaking down the silos that have gotten in the way of taking care of the whole person rather than limb by limb and illness by illness,” said Anthony Wright, executive director of Health Access California, a consumer advocacy group.

It would also be an expensive step. California is expected to have a $22.5 billion budget deficit this year, and it could get bigger in years to come. Meanwhile the state’s Medicaid spending is projected to increase by $2.5 billion over the next three years, according to the nonpartisan Legislative Analyst’s Office.

“What we’re really doing is expanding the welfare state, which is going to become just a huge financial problem,” said Wayne Winegarden, senior fellow at the Pacific Research Institute, a group that advocates for free-market policies.

California experimented with using Medicaid money for some housing-related expenses in 2016 when it launched a pilot project in 26 counties. While Medicaid did not pay for rent, it paid for things like security deposits and furniture.

In Marshall’s case, he pays his own rent, using some of the $1,153 per month he gets from Social Security and Supplemental Security Income. But Medicaid paid for his security deposit, bed, sofa, table, chairs and nearly 3 1/2 gallons of Pine Sol. Marshall said keeping his apartment clean is one thing that helped his leg wound to finally heal.

Over five years the program has reduced expensive hospital stays and emergency room visits for people on Medicaid, saving taxpayers an average of $383 per patient per year, according to an analysis by researchers at UCLA.

Now California wants to go further by using Medicaid money to directly pay some people’s rent. Democratic Assemblymember Joaquin Arambula, who chairs the budget subcommittee that will vet Newsom’s proposal, said lawmakers are supportive. Arambula spent a decade as an emergency room doctor.

“I became very good at being able to get cockroaches out of people’s ears,” Arambula said. “The living conditions of many of our communities, especially in our rural communities, really can affect a person’s ability to get adequate sleep, to be prepared for the next day and to stay healthy.”

Advocates for homeless people say they welcome such programs but spending more money on rent isn’t enough, noting the state still has a massive shortage of affordable housing.

Kelly Bennett, founder and CEO of Sacramento Covered, said that during California’s first experiment with using Medicaid money for housing services, it would often take up to eight months for workers to place a patient in an apartment. In some cases, people have waited for years to find a place.

“Even when you have the deposit money and you have some rental subsidy, it’s still very, very challenging to find units — and to find units where the landlords will lease to our clients,” Bennett said.

Marshall said he grew up in Sacramento and got a degree in dietic technology and culinary arts. But a 30-year addiction to meth landed him on the streets from the late 1990s through about 2006. He camped at an old landfill, often eating leftovers from people’s picnics at a nearby park.

Click here to read the full article in AP News

Filed Under: Top Stories Tagged With: California Politics, Housing, Medicaid

Q&A: 5 questions that arise from LAUSD’s historic labor settlement

March 28, 2023 By Clara Harter 1 Comment

Despite the deal with the district’s service workers union, much remains to be addressed, including learning loss and negotiations over a new contract with teachers.

Los Angeles Unified School District workers, parents and leaders alike rejoiced when a labor contract agreement was reached Friday, March 24, following a mammoth three-day strike that shut down America’s second-largest school system. But as the celebrations wind down and the school year rolls on, many uncertainties remain and challenges await.

In the coming weeks, members of SEIU Local 99 — the service workers union representing 30,000 bus drivers, custodians, instructional aides, cafeteria workers and special education assistants — must ratify what is still a tentative agreement. And the district must implement its new contract with the union.

But the road doesn’t end there.

The district must also get students and teachers back into their routines, reach a separate agreement with the teachers union, respond to three days of lost learning and tie up other loose ends.

And, in just one year, the district must reach a fresh agreement with SEIU Local 99, whose leaders have made it clear that they will be ready to strike again if their problems are not addressed.

So, in the aftermath of the historic strike and settlement, here are some questions that arise:

What do the agreement numbers actually mean for service workers?

So many numbers were thrown around during the strike — around $4.9 billion residing in district reserves, a $25,000 average service worker salary, a $440,000 superintendent salary, a 30% pay raise demand and a 23% offer on the table — that it was hard to keep them all straight.

When the agreement was finally hammered out, even more numbers were thrown into the equation.

Here’s what its numbers mean in practice:

By Jan. 1 of next year SEIU members will have effectively received the 30% pay raise that labor leaders have been demanding from the outset of negotiations.

This is divided into a 6% retroactive raise for the 2021 school year, a 7% retroactive raise for the 2022 school and a 7% increase in July 2023. In January, workers will receive an additional $2-an-hour pay bump, which SEIU Executive Director Max Arias says reflects an average 10% raise for workers.

In addition, all SEIU members who worked in-person during the 2020 to 2021 school year will receive $1,000 in recognition of their sacrifices during the pandemic.

Other key numbers to bear in mind are the district’s promise to bring its minimum wage to $22.52 an hour and to invest $3 million in an education and professional development fund for SEIU members.

These figures will make a huge difference in the lives of service workers, many of whom work multiple jobs to make ends meet and one-in-three of whom have said they are either homeless or at risk of becoming homeless, according to a survey completed by the union.

“This is an equity-driven contract that will elevate potential, address homelessness and address poverty in our community,” said Superintendent Alberto Carvalho at a press conference on Friday.

Labor leaders were also excited by the agreement reached after their members sacrificed three days of pay and picketed through wind, rain and hail.

“SEIU Local 99’s Bargaining Committee is proud of the tentative agreement we reached with the District, which answers our core demands,” said Arias. “We emerged stronger than ever from this week’s strike and showed the entire nation that unions are the most powerful force for economic opportunity and equity.”

At week’s end, Carvalho also appeared pleased — and relieved — with the deal.

“When we started negotiating with SEIU, we promised to honor the dignity of our workforce, correct inequities impacting the lowest-wage earners, continue supporting critical student services and protect the District’s financial viability,” he posted on Twitter. “Promises made, promises delivered.”

Some parents, on the other hand, were frustrated by the whole affair and wish that the union had reached an agreement with the district instead of disrupting learning for three days. Prior to the strike, the district had offered a 23% raise over time and a one-time 3% retention bonus.

How will the district address three days of lost classroom time?

Around 420,000 students missed three days of classroom instruction during the strike.

Had they not just emerged from a highly disruptive pandemic, these days would likely just be a blip, said Pedro Noguera, dean of the USC Rossier School of Education. But, piled atop more than two years fraught with an alarming rate of learning loss and missed socialization, they represent a more significant harm, he added.

María Sanchez, a South Los Angeles parent whose son is deaf, said she already had a hard time getting him to readjust to in-person schooling and is very worried about how the strike will set him back.

“As it is, it’s hard for me to get him on the school bus… I’m seeing changes in his behavior. He’s become more difficult, disruptive. He’s also communicating less with me and with his classmates,” she said. “I believe this is due to all the learning disruption.”

Fortunately, Carvalho already has a playbook for tackling this issue, spurred in part by standardized test results that showed LAUSD students lost approximately five years of academic ground during the pandemic.

A key part of his plan are two bonus “acceleration days” tacked on to each semester, that offer targeted learning support, the chance for students to raise their grades and engage in enrichment activities.

The first-ever set of days took place on Dec. 19 and 20 and had somewhat lackluster attendance of around 40,000 students. The second set of these days is just around the corner on April 3 and 4 and it will be interesting to see whether more families take advantage of them in the aftermath of the strike.

Other parts of Carvalho’s strategy to address learning loss include increased weekend, during school and after school tutoring as well as a new evening bus service to encourage more students to take advantage of after school programming.

What does this all mean for ongoing negotiations with the teachers union?

In an email to its members on Friday, shortly after the district and SEIU announced they had reached a tentative agreement, UTLA touted its collective action with SEIU as a show of force and signaled that it’s prepared to ratchet up pressure on the district once more.

“Carvalho has been put on notice that he better move on our demands,” the memo stated. “If that movement is not enough to settle the contract that UTLA members deserve, we will move to the next round of this fight.”

UTLA is seeking a 20% salary increase over two years; lower class sizes; the hiring of additional nurses, librarians, counselors and other positions; and full funding of the Black Student Achievement Plan and the special education program, among other demands.

Chris Zepeda-Millán, chair of UCLA’s labor studies program, said “hands down” UTLA has the advantage at the moment.

Not only does UTLA have a larger war chest to sustain a longer strike than SEIU could, Zepeda-Millán said, there are more members of the school board endorsed by UTLA now than during the 2019 strike. And should UTLA reach the point of striking again, there’s a chance SEIU members will stage its own solidarity strike to return the favor to the teachers union for supporting it last week, he said.

“The district knows (the unions) can shut (schools) down pretty easily, and they just showed us,” Zepeda-Millán said. “That’s going to be on the back of both teams’ minds as they’re negotiating.”

What will this mean for the local and national labor movement?

You can bet that workers in surrounding school districts, as well as other large urban districts throughout the country, will want more from their employers now, said Thomas Lenz, an adjunct professor at the USC Gould School of Law and a labor law attorney.

The union’s efforts last week were “transformational,” Lenz said, noting that even when it takes a while, walkouts — and the sacrifice of lost wages that go with them — “can have a return on investment.”

“I will be expecting the local unions will be ramping up their demands, and the members who hear about this will be increasing their expectations because they know it can be done,” he said.

Experts also took particular note of teachers and others who joined with the service workers, who rarely strike.

The fact that teachers walked off the job in solidarity with striking service workers gave them a lot more power and leverage, said UCLA education professor John Rogers. In addition, politicians at city, state and federal levels spoke out in support of the strike.

“I think that each victory for organized labor sends a message to organized labor across the country in various different industry sectors,” Rogers said. “The most powerful messages will be sent to other similarly situated education workers, who will see the advantages of aligning with their teaching union and who will see that they can build power.”

What’s next for Superintendent Carvalho?

When Carvalho first arrived from Florida, a state where labor unions are relatively weaker, many wondered how he would fare in terms of navigating local school politics and unions here in L.A.

One action that angered district employees last month was a tweet the superintendent posted on Feb. 10, which read: “1,2,3…Circus = a predictable performance with a known outcome, desiring of nothing more than an applause, a coin, and a promise of a next show. Let’s do right, for once, without circus, for kids, for community, for decency. @LASchools”

SEIU members, who took a strike authorization vote that week, were offended, believing the superintendent was effectively calling them clowns.

“For members it demonstrated blatant and continued disrespect for their work and their right to take action to improve their livelihoods,” SEIU Local 99 spokesperson Blanca Gallegos said in an email.

On Friday, a district spokesperson said in a statement that people misunderstood the tweet.

“The tweet was deleted because it was misinterpreted as related to the SEIU Local 99 strike authorization,” the statement read. “Consequently, because the tweet was wrongly inferred as a maligning of our own employees, we determined it necessary to remove.”

In a follow-up interview, LAUSD spokesperson Shannon Haber said Carvalho was referencing “one of the many national issues happening in our country” at the time, though she would not specify the issue.

Although Carvalho’s image may have taken a hit in recent weeks due to ongoing labor strife, Zepeda-Millán said, the superintendent can turn things around.

If Carvalho could settle negotiations with UTLA and get the unions to join him in advocating with the governor and state Legislature for greater longterm investments in public education, he could help lead a statewide campaign that could win him points, Zepeda-Millán said.

“Carvalho has a chance to say, ‘I’m going to do things differently this time and let’s show the state and the country that if we have well-paid teachers, smaller class sizes – what all the research says works – we could have great public schools again,’” he said.

To be sure, Carvalho still has the support of many parents.

United Parents Los Angeles, a group which oftentimes is at odds with the teachers union, said in a statement that it’s “rooting” for Carvalho.

“Carvalho has been a much-needed student and academic oriented leader that has done a lot of community outreach. Many families feel that their kids are represented for the first time in years,” the statement said.

The group went on to say that for the district to combat enrollment drops and retain students, it must prioritize smaller class sizes and support schools by “trim(ming) the fat and redirect(ing) that spending” responsibly.

Click here to read the full article in the LA Daily News

Filed Under: Uncategorized Tagged With: California Politics, Los Angeles, Teachers Union

Newsom Displays Penchant for Shiny New Things on California Tour

March 27, 2023 By Dan Walters 3 Comments

As a species, politicians love news conferences and other events that celebrate new programs or public works projects.

The syndrome may explain why officials often ignore long-festering problems in existing programs, such as the Employment Development Department and the bullet train project. Simply making things work better doesn’t have the political appeal of something new and shiny.

Gov. Gavin Newsom is particularly prone to the affliction, declaring early on his love for “big, hairy audacious goals” and later adding, “I’d rather be accused of (having) those audacious stretch goals than be accused of timidity.”

That proclivity led him, as a candidate, to pledge that he would try to solve California’s housing crisis by building 3.5 million new houses and apartments by 2025 and make California the first state to embrace single-payer health care.

Later, when both proved to be unattainable, he declared them to be “aspirational” rather than firm promises.

Newsom’s tendency toward the grandiose was very evident this month when he once again shunned a traditional State of the State address to the Legislature and instead toured the state for serial announcements.

One is converting San Quentin prison into a laboratory to test whether a softer approach to preparing felons for release, modeled after a program in Norway, will be more effective in steering them away from crime. Newsom boasted that the renamed San Quentin Rehabilitation Center will be the “most innovative rehabilitation facility” in the nation, displaying another characteristic, his obsession with being the first to do something.

The splashiest of Newsom’s new things is a multi-billion-dollar plan to house thousands of homeless and mentally ill Californians in new facilities that would combine shelter with treatment for their afflictions.

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The project would be financed mostly by a bond issue in the $3-5 billion range to be placed before voters next year and would be an adjunct to Newsom’s “Care Court” program that allows the mentally ill to be compelled to accept treatment.

“It’s unacceptable what we’re dealing with at scale now in California,” Newsom said. “We have to address and come to grips with the reality of mental health in our state and in our nation.”

Even if implemented as hoped, the two mental health projects would make only a relatively tiny dent in the state’s homelessness crisis. California still lacks a comprehensive approach and is mired in finger-pointing among state, county and city officials over who’s responsible for dealing with it.

Billions of dollars have been spent by all three levels of California government, plus no small amount of federal funds, but the number of unhoused Californians continues to climb, officially approaching 200,000 but probably much higher.

The exchanges between Newsom and county officials have been especially pointed. He’s accused counties of dragging their feet on effectively spending state grant money while county officials say they need a dedicated and predictable revenue stream for long-term programs.

As Newsom was touring the state, the California State Association of Counties, or CSAC, issued what it said is a comprehensive approach to homelessness embracing housing, social services, education and employment with clear lines of responsibility and accountability for outcomes.

Click here to read the full article in CalMatters

Filed Under: Top Stories Tagged With: California Politics, California Tour, Gavin Newsom

Public-Employee Unions Trample Our Public Services

March 27, 2023 By Steven Greenhut 2 Comments

SACRAMENTO – In a short 1814 fable from Russian poet Ivan Krylov, the Inquisitive Man spends three hours at a natural history museum and tells his friend he “saw everything there was to see and examined it carefully” and found it “all so astonishing.” The friend then asks what he thought of the elephant. The man retorted: “(D)on’t tell anybody – but the fact is that I didn’t notice the elephant!”

That is the origin of the phrase, “the elephant in the room.” It means, as Cambridge Dictionary explains, “an obvious problem or difficult situation that people do not want to talk about.” There are many reasons people ignore a 10,000-lb. creature blocking their way, but often it involves cowardice. It’s too hard – or controversial – to discuss how it got there and how to get rid of it.

This is an obvious allegory to California’s state government. Gov. Gavin Newsom recently proposed a new bond measure to fund programs to deal with the state’s homelessness crisis. California already spends several billion dollars a year on the problem. Localities such as Los Angeles spend as much as $1 million per unit on housing for homeless people, yet the problem keeps getting worse.

Last year, California spent approximately $136 billion on its public schools. The latest data shows dramatic drops in test scores, with only a third of the state’s students meeting math-proficiency standards. If you’re apt to solely blame the pandemic shutdowns, consider that a 2019 study found only 30 percent of students proficient in reading.

Throughout California, pension costs keep rising, grabbing a larger share of local budgets and crowding out public services. Despite a previous $97.5-billion budget surplus, California has been remarkably unable to fix its creaky transportation system, improve public-school performance, provide adequate water supplies during the recent drought, deal with misbehaving police officers, provide safe and user-friendly transit systems and, well, you name it.

Just try to name one California agency that’s known for its efficiency and high levels of service. (It’s a trick question.) Nevertheless, the Legislature and governor spend enormous time and resources trying to address these intractable problems through various tax-increase proposals, legislation, reforms, oversight commissions, inspector generals, auditors, lawsuits and bond measures. Yet the public never sees substantive improvement.

The reason is everyone is politely avoiding the giant pachyderm. I’m referring to the state’s public-sector unions, which – thanks to their enormous financial might and legions of members – control the Capitol. The California Teachers’ Association is the most-powerful voice in education. Police and fire unions are the best-funded and most muscular political players at the local level. The prison guards’ union has an inordinate influence in corrections policy.

Unions aren’t entirely to blame for California’s myriad problems and crises, but they provide a heckler’s veto to any reform idea that could realistically improve public services. Consider how vociferously teachers’ unions opposed school reopenings. Lawmakers rarely propose any idea that would antagonize any of the state’s easily antagonized unions. Imagine running a business where the employees could immediately quash any proposal that might help consumers or reduce operating costs.

“Through their extensive political activity, these government-workers’ unions help elect the very politicians who will act as ‘management’ in their contract negotiations – in effect handpicking those who will sit across the bargaining table from them,” noted Daniel DiSalvo in a 2010 article in National Affairs. No wonder California’s municipal firefighters earn on average more than $200,000 a year – even as the state complains about an inadequate number of firefighters.

Sadly, no one with power even mentions these obvious roadblocks as they seek to reform any aspect of any public service. The progressive Democrats who control Sacramento are attached at the waist to public-sector unions, so they sidestep the elephant even though it’s trampling (and pooping) on their favorite programs. They side with this well-heeled special interest – and with workers who earn unfathomable compensation packages – even though it hurts the poor.

Republicans will thankfully blast CTA and SEIU, but they take a “don’t see the elephant” approach when it comes to police unions – who protect abusive officers the same way that teachers’ unions coddle their incompetents. Like all unions, the police and prison-guard varieties actively lobby for higher taxes and derail even the most modest proposed changesin how their departments operate. Policing is a tough job, but that doesn’t mean we can’t improve oversight and revamp procedures.

“Accountability is basically nonexistent in American government,” wrote Philip K. Howard in his new book, NOT Accountable: Rethinking the Constitutionality of Public Employee Unions. “Performance doesn’t matter. … Police unions, teachers unions, and other public sector unions have built a fortress against supervisory decisions. Political observers rue union power but treat it as a state of nature.”

Click here to read the full article in the OC Register

Filed Under: Trending News Tagged With: California Politics, pensions, unions

Gov. Gavin Newsom Announces Ending State Water Restrictions

March 26, 2023 By Evan Symon 8 Comments

Requestion water allocation rate climbs to 75% – the highest since 2017

Governor Gavin Newsom announced on Friday that the state would be ending numerous water restrictions, while keeping those aimed at preserving groundwater and helping further recharge the Klamath River and Colorado River areas.

For the past several years, the drought in California has brought forward numerous measures aimed at preserving water resources. These ranged from the more local efforts of not allowing hand watering in gardens, to California’s infamous 15% conservation target cut to water usage statewide. While the measures were partially successful in reducing water usage, more cuts were expected this year as the drought was expected to continue.

However, 12 major atmospheric river and bomb cyclones hit California in the first three months of 2023. While the rain brought everything from flooding to mudslides to snow in Los Angeles, it also significantly reversed California’s water woes. Drought conditions went from covering nearly the entire state last year to falling to only covering one-third of the state this month. Many reservoirs are now quickly approaching capacity after nearly emptying out in 2022. Snowpack levels are approaching 300% when only 100% is needed by April 1st to ensure enough water reaches Californians this year. Ski season in Tahoe is now even going until July since there is so much snow there.

Continued rains this month also led many localities to end water restrictions. This including the lifting of restrictions in Southern California, allowing the first regular water usage there since July 2022. As a result, pressure was soon placed on the state to end restrictions of their own, leading to Governor Newsom’s announcement on Friday.

According to Gov. Newsom’s roll back announcement on Tuesday, the 15% conservation target cut is to end, as are many drought contingency plans. This also included boosting up California’s allocation of requested water supplies to 75%, an increase of 40% from February and the largest amount of water being allowed to be doled out by the state since 2017.

However, Newsom also stressed that a drought was still on for many parts of the state, and that areas with groundwater reliance or those areas near the still-threatened Klamath River and Colorado River will still have restrictions in place. This includes:

Maintaining the ban on wasteful water uses, such as watering ornamental grass on commercial properties;
Preserving all current emergency orders focused on groundwater supply, where the effects of the multi-year drought continue to be devastating;
Maintaining orders focused on specific watersheds that have not benefited as much from recent rains, including the Klamath River and Colorado River basins, which both remain in drought;
Retaining a state of emergency for all 58 counties to allow for drought response and recovery efforts to continue

Drought restrictions eased statewide

“We’re all in this together, and this state has taken extraordinary actions to get us to this point,” said the Governor in a speech in Yolo County on Friday. “The weather whiplash we’ve experienced in the past few months makes it crystal clear that Californians and our water system have to adapt to increasingly extreme swings between drought and flood. As we welcome this relief from the drought, we must remain focused on continuing our all-of-the-above approach to future-proofing California’s water supply.”

Newsom’s announcement was well received on Friday, but with many water experts noting that even more restrictions could have likely been pushed back even more.

“The Governor was playing it cautiously,” explained Jack Wesley, a water systems consultant for farms and multi-family homes, to the Globe on Friday. “This is largely because a lot of people have told him that the drought isn’t over just yet. But then again those people also said January, February, and March were going to be dry too, and look how that turned out. So there is a lot we don’t know for the rest of the year, so some stay in place.”

“Of these, the restrictions around the Klamath and Colorado rivers make the most sense. They are both still very much under where they are supposed to be, so they still need help to flow right. It’s hard to argue on restrictions staying in place in those watersheds.”

“But, overall, this is just yet another sign that California is getting back to normal water-wise. It took a wild rainy three months, but even the Governor is starting to reverse his actions. That’s a very good sign.”

Click here to read the full article in the California Globe

Filed Under: Top Stories Tagged With: California Politics, Drought, Gavin Newsom

The COVID-19 Pandemic Permanently Damaged Property Rights

March 26, 2023 By Steven Greenhut 3 Comments

Officials used the crisis to impose policies they already supported but couldn’t get through the normal legislative process, like bans on evictions.

I don’t pay particular attention to health scares, so when talk of a spreading pandemic started dominating the news cycle I largely shrugged and went about my business. I was staying at a cheap motel in Calexico, taking photos of the New River and the Salton Sea for my book about California water policy, when my wife called from Sacramento and said, “You better get home. And I mean now.”

That was the weekend when the shutdowns began. I recall stopping at a grocery store near Modesto, when I noticed meandering lines and a run on toilet paper. The rest, as they say, is history. Like most people, I never could have predicted the coming shutdown of the economy, government orders to stay at home, an end to restaurant dining and public gatherings, and profligate “relief” payments.

As that (probably fake) George Washington quotation put it, “Government is not reason, it is not eloquence—it is force.” Government officials aren’t wiser than the rest of us, so when they tried to deal with a serious public health problem, they did so in a forceful, ineloquent, and unreasonable manner. Unfortunately, many of its worst approaches leave permanent scars.

In my column last year summarizing lessons from COVID-19, I concluded that it left us as a “nation of rulers, not laws.” American governors—and California Gov. Gavin Newsom in particular—quickly and eagerly used their broad emergency powers to begin issuing edicts. Given the extent of the public-health threat, some of the more modest and temporary ones were understandable, but they bypassed the normal legislative process in cynical and expansive ways.

One Republican lawmaker published a 138-page document detailing the 400 laws that Newsom unilaterally imposed or changed—many of them that only tangentially had anything to do with protecting public health. In particular, officials used the crisis to impose policies they already supported but couldn’t get through the normal legislative process.

The worst example involved anti-eviction orders that have literally destroyed our property rights. Virtually all mom-and-pop landlords depend on the rental income. With one fell swoop, governors (and the federal Centers for Disease Control) declared that tenants no longer had to pay their full rent if they faced a pandemic-related hardship. Sure, landlords could potentially collect rent in the future in civil court, but good luck with that.

In making it virtually impossible to evict non-paying tenants, policymakers imposed the full cost of their public-health plans on individual property owners, who could no longer count on getting a return on their investment. Often, property owners have mortgages—and they always have tax and insurance bills. When a heating system or roof leaks, they’re still required (ethically and legally) to make repairs. But they no longer could count on receiving rent.

Someone posted my column detailing the plight of landlords on a liberal housing-related news group, and you can probably guess the ensuing negative responses. No landlord I know expects any sympathy given that it’s the type of investment they freely chose.

However, I thought that most people—even renters who have had less-than-stellar rental experiences—might understand that if the government deprives owners of their supposed state constitutional right to a fair return on their investment, fewer people will go into the business and even fewer will upgrade their properties. That helps no one.

The result is obvious: fewer available rentals and fewer rentals in tip-top condition. Investing in rental property has always been a prime means for middle-class people to build wealth. My grandfather was an immigrant paperhanger (remember wallpaper?) who invested in Philadelphia row houses decades ago. Now, I talk to many people who won’t dare buy a rental house out of the legitimate fear that the government can suspend rent payments at will.

Tenants often outnumber owners, especially in larger cities such as Los Angeles. We see groups of activists lobbying for rent controls in Costa Mesa (and previously in Santa Ana). By eliminating property rights and shifting decisions to city councils (and tenant-dominated rental boards), the government has made owners’ livelihoods dependent on the political system. As the saying goes, democracy is two wolves and a sheep voting on what’s for dinner.

Certainly, many cities (San Francisco, Santa Monica, New York) embraced strict rent control long before the pandemic was a thing. They largely destroyed their housing markets of course, as renters stayed put in under-market units while investors high-tailed it elsewhere. But COVID added a new level of uncertainty. Look at how Los Angeles continually extended its anti-eviction provisions.

Click here to read the full article at Reason

Filed Under: Trending News Tagged With: California Politics, Covid-19, Property Rights

Ridley-Thomas Trial Draws Toward End with Sharply Conflicting Portraits of Politician

March 25, 2023 By Matt Hamilton Leave a Comment

In their final words to jurors who will decide the fate of suspended Los Angeles City Councilmember Mark Ridley-Thomas, federal prosecutors and the lawmaker’s defense attorney detailed sharply conflicting portraits of the man and the case against him.

To Assistant U.S. Atty. Lindsey Greer Dotson, Ridley-Thomas was a career politician who savvily conspired with a USC dean to obtain a slew of benefits for his troubled son in exchange for help with coveted Los Angeles County business. There was no explicit agreement between Ridley-Thomas and the USC dean, Marilyn Flynn, according to the prosecutor, but “winks and nods.”

“He leveraged his power to extract privileges for his son,” Dotson said. “Public officials do not get to monetize their public service. As a politician, you work for us, you work for the taxpayer.”

To lead defense attorney Daralyn Durie, however, the charges against her client were the fruit of a sloppy investigation, one that saw crimes where none existed and one that jumped to conclusions before turning over every stone.

“Everything that happened at USC was legal,” Durie told jurors.

She noted that the L.A. County votes at issue in the case were long-running projects that Ridley-Thomas publicly backed and assigned multiple staffers to work on. The projects — for a probation training program, a reentry facility and a remote mental health clinic — were central elements of his policy agenda.

“Nobody would think he needed to be bribed to do it,” Durie said.

The 19 counts against Ridley-Thomas include conspiracy, bribery, and honest services mail and wire fraud. If convicted, the 68-year-old could spend decades in prison. Jurors won’t begin deliberations until Friday after the government completes its final arguments.

The allegations of the government center on a period from 2017 to 2018 when Ridley-Thomas allegedly conspired with Flynn, then the dean of USC’s social work program, to obtain benefits for his son — a scholarship, admission to graduate school, a professor’s job and a donation to a nonprofit.

At the time, the program was struggling financially, and Ridley-Thomas’ son, Sebastian, was a state Assembly member facing a still-confidential sexual harassment investigation.

“The defendant was in a unique position: He could come to both their rescue at the same time,” Dotson told jurors.

Dotson directed jurors to a winter 2018 email in which Flynn sent “an extremely important request for a contract amendment.” Ridley-Thomas replied, “Your wish is my command,” and blind-copied his son.

Next, the email was forwarded to Ridley-Thomas’ staff. “He’s advising his staff to do certain things,” Dotson told jurors. “That’s an official act.”

Among the benefits Ridley-Thomas received: routing $100,000 from his campaign account through USC to a nonprofit run by his son.

Dotson said that it would be easy to donate money directly to his son’s nonprofit, but that Ridley-Thomas had to hide his tracks.

“He’s got to funnel the money and clean his connection,” Dotson said, reminding jurors that an earlier donation from Ridley-Thomas to his son’s nonprofit was rejected after a parent nonprofit objected to the nepotistic optics. Dotson invoked a geographic analogy: “If I’m going to drive from downtown Los Angeles to Santa Monica, I’m not going to drive through Bakersfield.”

After the money arrived, Ridley-Thomas messaged his son, “My piece is done,” with a fist bump emoji.

A linchpin of the government’s case is now-L.A. Mayor Karen Bass’ full tuition scholarship and Flynn’s comments on it. In a 2017 email, Flynn had described her plan to offer Sebastian Ridley-Thomas a scholarship and said she did “the same for Karen Bass — full scholarship for our funds.”

“It’s not rocket science what Marilyn Flynn is looking for here,” Dotson said, laying out a simple plan to curry favor with public officials for government contracts.

But Durie highlighted that then-U.S. Rep. Bass was never charged over the email. If Bass was not a criminal, the same should hold true for her client. If the email was true, it means “Karen Bass, the current mayor of Los Angeles, would be a criminal.”

Durie also pointed to the “for our funds” as a typo — that Flynn meant “from” our funds. One slide shown in court compiled all of Flynn’s typos in emails that jurors saw — misspelled words, hastily written messages.

“Dean Flynn was like 80 years old, which is super impressive,” Durie said. “But her typing skills, much like her financial management skills, were not her strong point.”

A long-running effort of the defense has been to chip away at the prosecution’s case by laying into the credibility of the lead investigator, FBI Special Agent Brian Adkins. Throughout the trial, several witnesses who worked at L.A. County testified that theyweren’t questioned by the FBI, and Durie got Adkins to acknowledge that emails at L.A. County weren’t subpoenaed during the investigation.

“This is a criminal case. If you are going to bring charges, you better be sure that you are right — and you better do your homework,” Durie said.

The defense attorney pointed out shifts in Adkins’ testimony: that he initially said he reviewed more than 400,000 documents in the case, then said either he or other agents reviewed them. Durie reminded jurors of an episode during Adkins’ testimony when she cross-examined him, and the lawyer appeared to identifyan error in his timeline over whether Sebastian Ridley-Thomas was interviewed in the sexual harassment investigation.

“This whole case is about timing,” Durie said, adding, “That makes it really important not to get it mixed up.”

Durie pointed to other lapses: Investigators seemed incurious about how the county government worked and even misstated the nature of the items that make up the “quo” in the quid pro quo — two of the three items were “studies” in which further research would be done for supervisors, not contracts per se.

“Who did the government present to you as witnesses? By and large, they brought you people from USC,” Durie told jurors.

A centerpiece of the government’s case is a summer 2017 meeting with Ridley-Thomas, which Flynn later memorialized in a letter. The letter was hand-delivered to Ridley-Thomas’ office, and it outlined Flynn’s requests of the politician regarding county business.

Dotson said the letter was proof positive of Flynn and Ridley-Thomas mixing Sebastian’s extraordinary benefits at USC with county business.

Durie cast doubt on the letter: “Someone found that letter, saw that it had been hand-delivered, and thought, ‘Aha!’”

Instead, Durie said, the multi-page letter was hand-delivered because of particularly sensitive content: a demographic breakdown of the members of a research initiative on homelessness. The letter noted harshly that the committee was largely white and had no members with “lived experience,” which jeopardized the legitimacy of the research.

Prosecutors situated the sexual harassment allegations against Sebastian Ridley-Thomas — and the need to keep the brewing scandal quiet — as a driving force in the conspiracy. But Durie, in a voice that was noticeably calmer and slower than her argument, wondered aloud if jurors had friends or relatives who’ve been accused of misconduct.

“Mark Ridley-Thomas is on trial,” Durie said. “He’s certainly not on trial for anything his son did.”

Click here to read the full article in LA Times

Filed Under: Top Stories Tagged With: California Politics, Los Angeles, politicians

Psychedelic Drug Decriminalization Bill Passes Senate Public Safety Committee

March 25, 2023 By Evan Symon 2 Comments

Another new Assembly Bill with narrower focus quickly gains support

A bill to decriminalize plant-based psychedelic drugs was passed by the Senate Public Safety Committee this week completing the bill’s first major hurdle, while a new major challenge to the bill has quickly gained support in the Assembly.

First introduced in December of last year, Senate Bill 58 by Senator Scott Weiner (D-San Francisco) would decriminalize plant-based and other natural hallucinogens such as psilocybin (magic mushrooms), dimethyltryptamine (psychedelic drug DMT), ibogaine (psychedelic substance), and mescaline (psychedelic hallucinogen). In addition, law enforcement would be unable to charge those holding the drugs with a criminal penalty while also still being completely illegal for minors.

SB 58 would also remove bans on having psilocybin or psilocyn spores that can produce mushrooms and on having drug paraphernalia associated with all decriminalized drugs.

The bill is a significantly pared down version of SB 519, first introduced in January 2021 by Weiner that would have not only legalized the psychedelics in SB 58, but also would have included synthetic hallucinogens such as lysergic acid diethylamide (LSD), ketamine (“dissociative anesthetic”), and 3,4-methylenedioxymethamphetamine (MDMA, ecstasy, molly). However, the bill was amended heavily in 2021 and 2022, removing ketamine and other troubling parts for legislators and oppositions groups, such as law enforcement agencies. Despite the changes, the bill was still gutted in August, removing everything but a single study on the use of the remaining drugs. SB 58 continued to water down the bill, removing peyote from the proposed decriminalization list and removing a provision to study future reforms.

The effort to make the decriminalization more palatable for lawmakers appeared to be working on Tuesday, with the Senate Public Safety Committee voting 3-1 to pass the bill.

Before the vote on Tuesday, Senator Wiener noted that “These are not addictive drugs. And these are drugs that have significant potential in helping people to navigate and to become healthy who are experiencing mental health, challenges substance use challenges.”

“We know that cities in California and elsewhere have passed resolutions to categorize enforcement of these particular criminal laws as the lowest law enforcement priority. This is an important step for California. This is about making sure that people have access to substances that they need that are not addictive.”

Rival bill in Assembly expected to challenge SB 58

However, while SB 58 did ultimately move this week, another bill on the horizon in the Assembly is now threatening to derail it. Assembly Bill 941, authored by Assemblywoman Marie Waldron (R-Valley Center), was introduced last month. According to AB 941, certain psychedelic drugs would be green-lighted for use, but only in psychedelic-assisted therapy sessions for combat veterans.

The bill, also known as the End Veteran Suicide Act, takes a more cautious approach and would authorize a licensed professional clinical counselor to administer controlled substances to combat veterans. Psychedelic-assisted therapy would be required to take place over a minimum of 30 sessions, with therapy sessions to be a minimum of 12 hours in duration. The bill would also require 2 or 3 licensed professional clinical counselors present per patient at a psychedelic-assisted therapy session.

While the bill is currently awaiting to be heard in the Assembly, many law enforcement and medical professionals noted that AB 941 is preferable to SB 58 due to more of a controlled and monitored use, as well as the serving as more of a test to see if psychedelic treatments could then be expanded to more Californians in a safe and effective manner.

“Wiener’s bill is more one size fits all,” explained former police officer and current drug counselor Marty Ribera to the Globe on Thursday. “This other bill is a bit more tailored. Psychedelic treatment isn’t for everyone. And rather than just decriminalize willy-nilly, AB 941 can help bring along a pathway to use them for good, and more critically, to identify the people who can benefit from their treatment and making sure that using them would not bring on any negative side effects like depression, long-term psychosis, or in more of a social context, bad trips.”

“We need this to be on a case by case basis and to have a small pool to test on to make sure his type of therapy can work like this. Psychedelics can help treat major issues like PTSD. We have the research. But we also see psychedelics ruin peoples lives. I’ve always said, for every success story there are two others that tried it on their own and ruined their life. We need to be open to this as a treatment, but also very cautious about it.”

Click here to read the full article in the California Globe

Filed Under: Trending News Tagged With: California Politics, Drugs, Legislature

State May Scale Down Its New Home Loan Program Designed to Assist First-Time Homebuyers

March 24, 2023 By Alejandro Lazo 2 Comments

In this economy, who has enough money for a down payment on a house?

Despite a projected $25 billion budget deficit, the state of California does. At least for now.

The California Housing Finance Agency is poised to launch a scaled-down version of its new shared equity home loan program on March 27. With the Dream for All program, the state plans to provide $300 million worth of down payments for an estimated 2,300 first-time homebuyers.

The complicated program involves the state paying some or all of the upfront costs for buying a home — the down payment, for instance — in exchange for a share in the home’s value when it is sold, refinanced or transferred.

If the home appreciates in value, those gains to the state would then be used to fund the next borrowers — a little for the seller; a little for the next aspiring buyer.

Everybody wins — as long as prices go up.

The trouble is that home prices have been declining in the state for months, even as higher mortgage interest rates have made monthly mortgage payments more expensive.

A potential economic downturn looms as well, as the Federal Reserve weighs raising borrowing costs even further as soon as today.

And California’s tech industry is taking a beating and laying off workers, contributing to a decline in personal incomes. Income taxes are the state’s biggest revenue source.

Given the uncertainty, Gov. Gavin Newsom in January proposed a significantly smaller version of the 10-year, $10 billion program originally envisioned by Senate President Pro Tem Toni Atkins, a Democrat from San Diego. In his January budget, Newsom proposed spending an initial $300 million on the program, a cut from the $500 million compromise signed last year.

Optimism and expectations

The size and scope of the Dream for All program will likely be a subject of negotiations between Newsom and the overwhelmingly Democratic Legislature this year. The governor is expected to offer a revised state spending plan and a new financial forecast in May. Lawmakers must pass a balanced budget by June 15 in order to get paid.

The proposed cut “will not impact the Administration’s commitment or timeline for implementing the program,” Newsom’s Department of Finance said in January.

In a Feb. 13 email to CalMatters, Christopher Woods, budget director for Atkins, said her office will seek more funding for the program.

“The Governor ‘proposing’ to pull back some funds has very little to do with what will actually happen,” Woods wrote to CalMatters, in response to earlier coverage of the program. “No one should expect the program to be cut, and we should all fully expect additional funds – perhaps as much as $1 billion – to be allocated in the 2023-24 Budget Act.”

“With interest rates rising, the program is needed more than ever … and there are several innovative ways to fund the program,” Woods wrote.

Woods declined to answer follow-up questions for this story.

Atkins, who championed the equity sharing program last year, has said the Dream for All program is a priority. She said in a recent statement she isn’t giving up on getting more money for it.

“Our state is about to launch a program that will help change people’s lives for the better, and make the dream of homeownership a reality,” she said. “While existing funding for the California Dream for All is a great first step, we are working to allocate additional funding in the upcoming state budget — with the ultimate goal of providing $1 billion per year — to help even more families set the foundation for building generational wealth.”

Falling equity

The uncertainty in the economy and housing market has been a subject of discussion at CalHFA for months, as officials and political appointees seek to launch a program meant to take advantage of rising home prices at the very moment home equity is falling.

State officials said buyers positioned to hold onto a property for the long-term are those best suited for the program when home prices are falling.

In a presentation to its board of directors in January, CalHFA officials also said the agency is planning for a program with a potentially “very short life cycle.”

“Having lived the dream of buying a house in Los Angeles in 1989, when the market peaked, and then selling it at a loss almost a decade later, I can appreciate that the market doesn’t always go up,” Jim Cervantes, CalHFA’s chair, said during that Jan. 19 meeting.

“Disclosures, whatever we can do to mitigate — or rather, have prospective buyers understand what they’re getting into — would be extremely valuable, because no one’s a good market timer.”

California home prices, already rising for years, saw big gains during the pandemic, as mortgage interest rates hit historic lows and families sought more space for their remote work set-ups to practice social distancing.

The median price of a previously-owned, single-family home in California, as tracked by the California Association of Realtors, increased 47% from March 2020 to May 2022, when it peaked at $900,170.

That same month the Federal Reserve, in order to tackle inflation, began its most aggressive interest rate hikes in years driving up mortgage costs for consumers.

Since May 2022, the state’s median home price has fallen 16.5% to hit $751,330 in January.

Market change

Despite the decline in home prices, monthly mortgage costs continue to make the state’s housing market more unaffordable than at nearly any point in the last 15 years, particularly for lower- and middle-class families. Only 17% of families in California could afford a median-priced single family home at the end of last year, according to the Realtors group.

Given the rapid market changes, Tiena Johnson Hall, CalHFA’s executive director, called the governor’s reductions in Dream for All funding prudent at CalHFA’s January meeting. “There’s still a lot of room for (home) values to continue to decrease, and that is what we expect to see,” she said.

In February, the state’s nonpartisan legislative analyst projected a revised $25 billion deficit in next year’s state budget. Since then, job growth nationally and in California has remained strong, except for layoffs in the tech sector.

The full details of the Dream for All program — for instance, which lenders will offer the shared equity loans to borrowers — are not yet available from CalHFA.

And loans will not be immediately available to consumers when the program launches this month. Lenders will need a month to six weeks to roll out the loans and begin marketing them to consumers, said Ellen Martin, a CalHFA official tasked with designing the program.

“We do know that there’s a lot of excitement out there,” Martin told CalMatters in a recent interview.

How it will work

Some details have been revealed in CalHFA board meetings, public hearings and a report to the state Legislature. Here are some of the program’s key components.

The loans will not be available for all Californians. Only those who earn 150% or less of the median income of others in their county qualify. Those income limits vary by county, with $300,000 being the cut-off in pricey Santa Clara and San Francisco counties, but $159,000 for many inland counties such as Fresno and Merced.
The loans will cover as much as 20% of a home purchase. Whenever a home is sold, transferred or refinanced, a borrower will owe the state the original amount the state invested, plus a percentage of the home’s increase in value. If the original loan was 20 percent of a home’s value, the seller would owe the state the original loan plus 20 percent of its increased value, though that amount would be capped at 250% of the original loan amount.
A social equity feature of the program will be included for those who earn as much as 80% of the area median income. They will get to keep more of their equity when they sell, refinance or transfer their properties than others with higher incomes. Also about 10% of the initial state funds, or $30 million, will be reserved for those lower-income borrowers.
The loans can be used to fund down payments and closing costs, including interest rate buydowns.
Given the complexity of the program, borrowers will be required to complete a homebuyer education course.

Advocates’ concerns

The complexity of the program has some consumer advocates worried.

Lisa Sitkin, a senior staff attorney with the National Housing Law Project, said it would be wise for the agency to ensure borrowers receive periodic notices about the loan’s atypical details.

“As time goes by, people tend to forget and treat it as a normal loan, and I think it is useful for people planning to be reminded,” said Sitkin, a member of a working group advising CalHFA on the program.

A proposal to sell the loans as mortgage-backed securities also has her worried. California officials are exploring the idea of pooling the shared equity loans into securities and selling them to investors, to help provide additional money for other borrowers.

Many Wall Street financial institutions bundled often poor-quality mortgage loans into securities during real estate’s boom years and sold them to major investors. But during the years of downturn, getting help to homeowners was complicated by the difficulties identifying who exactly owned these loans.

“If they are sold into private, securitized trusts there is a lack of transparency about who owns your debt, and a lack of information about options if there are problems,” Sitkins said. “I really want to be sure that there are guardrails and protections for the borrowers.”

Consumers are cautious

As CalHFA officials were designing the program last year, they held several listening sessions online, taking comments from the public. Jake Lawrence, a 41-year-old cannabis entrepreneur in Willits who also runs a nonprofit, said he liked what he heard.

“I’m very interested. The problem we face is that there’s such a flux in what’s going on,” Lawrence said. “We’re in the middle of a housing market bust, so we’re gonna watch prices tumble for a minute.”

What’s more, one of the county’s biggest industries, the marijuana trade, has been hit hard by declines in cannabis prices. “It’s beyond suffering,” Lawrence said.

Lawrence also wondered how the state will calculate equity if he makes improvements to a home.