Oakland, Near-Broke, Will Use Gas Tax Money to Keep Lights On

The City of Oakland is in such dire financial straits that it is planning to use $2.9 million from state gas tax revenues to keep the city’s lights on, rather than using the money to fix pothole-riddled roads, for which the funding was intended.

The San Francisco Chronicle reported Wednesday that the city is facing severe financial shortfalls, despite a booming economy that has seen wealthier households relocate from San Francisco across the bay to gentrifying neighborhoods.

The problem is that the city’s costs are rising faster than its growing revenues, thanks partly to pension obligations — an increasingly common challenge for large, Democrat-run cities that made ambitious promises to public sector unions.

As Oakland Mayor Libby Schaaf — famous for tipping off illegal aliens to an impending federal law enforcement sweep, in an effort to defend her “sanctuary city” — noted in her recent budget statement to the city council last week:

Though cranes are rising across the skyline and Oakland’s revenues are growing at a steady rate due to the strong real estate market, the City’s expenses continue to rise faster than revenues. Personnel-related expenses, particularly the cost of medical benefits and pensions – as well as insurance, utilities, and fuel costs – are growing at 2-3 times the rate of inflation and revenue growth.

The deficit for this year will be $25 million. As a result, the Chronicle notes, Oakland — which is generously extending benefits to illegal aliens — can barely keep its street lights on.

To deal with the crisis, the city is shifting money from pothole repair to street lighting, even though the money raised by the 2017 gas tax must be used for transportation.

The Chronicle notes that Oakland’s believes that street lighting qualifies:

Enter the state gas tax.

The mayor is proposing to use the $2.9 million to pay for the street-lighting portion of the shortfall, then use the savings to keep the parks open.

According to Article 19 of the state Constitution, gas tax money is to be used for the “research, planning, construction, improvement, maintenance and operation of public streets and highways (and their related public facilities for nonmotorized traffic).”

Oakland officials feel that gives them the cover to use the tax money to light the streets as well.

The city will still apparently have other funds, both from the gas tax and its own revenues, to use for pothole repair — though less than it would otherwise have had.

Republicans attempted to repeal the gas tax hike in a 2018 ballot initiative, but the state government gave the measure a misleading title. As a result, the measure failed, though polls showed a majority of Californians opposed the hike.

The budget notes that the city will spend $150,000 per year on a legal fund to assist illegal aliens facing deportation.

Joel B. Pollak is Senior Editor-at-Large at Breitbart News. He is a winner of the 2018 Robert Novak Journalism Alumni Fellowship. He is also the co-author of How Trump Won: The Inside Story of a Revolution, which is available from Regnery. Follow him on Twitter at @joelpollak.

This article was originally published by Breitbart.com/California

Lessons from the Los Angeles and Oakland teachers’ strikes


Teachers in the nation's second-largest school district will go on strike as soon as Jan. 10 if there's no settlement of its long-running contract dispute, union leaders said Wednesday, Dec. 19. The announcement by United Teachers Los Angeles threatens the first strike against the Los Angeles Unified School District in nearly 30 years and follows about 20 months of negotiations. (AP Photo/Damian Dovarganes) ORG XMIT: CADD303

After two teachers’ strikes in as many months in California, it is too soon to tell whether the labor disputes in Oakland and Los Angeles presage a new era of school-based activism.

But regardless of what comes next, this year’s strikes had much in common, and yielded valuable lessons and insights for other districts where labor troubles may also be brewing.

  • Both strikes were relatively short, lasting about a week. The timeline was shaped by the troubled finances of both districts that couldn’t afford to lose excessive amounts of state funds they receive based on student attendance.  Teachers also couldn’t afford to lose excessive wages by being out on strike for a lengthy period, or to take money off the bargaining table that could have been used to meet some of their demands. So there was pressure on both sides to resolve the strike within a reasonable amount of time.
  • In both cases, teachers appeared to come out ahead, achieving gains they might not have won without a strike. In Oakland’s case, teachers earned a gradual salary increase of 11 percent  — more than double the 5 percent the district offered before the strike began — although most of the gains will only come in the 3rd year of the agreement. In the case of Los Angeles, on the salary front teachers got less than what they demanded initially, and settled for the 6 percent the district had already offered. But they did get commitments from the district to reduce class sizes and significantly increase support staff like counselors.
  • In both strikes, demands went beyond those more typical of labor strikes which tend to focus on wages and benefits. Those were on the table, but equally important were a range of other issues , including lowering class sizes, providing more counselors, psychologists, nurses and other support staff, limiting school closures in Oakland and creating community schools in Los Angeles.  Both contracts also included provisions tied to regulating charter schools.re
  • In both Oakland and Los Angeles there remains a great deal of uncertainty about how the districts will pay for what they agreed to. In Los Angeles, Debra Duardo, the county superintendent of schools, said that the district has yet to address a projected $500 million operating deficit in 2021-22, and that the bargaining agreement “continues to move the district to insolvency.” In Oakland, Najeeb Khoury, in his official fact-finding report issued before the strike, doubted that the district could afford anywhere near a 12 percent salary increase.  Chris Learned, the state trustee appointed to approve budget expenditures, also suggested before the strike that such an increase ran the risk of putting “the district in financial distress.”
  • In both Oakland and Los Angeles, the strikes demonstrated deep public support for the teachers. It suggests that the days when teachers were held solely responsible for seemingly every shortcoming in the state’s public schools, along with the success or failure of their students, are over, at least for now.
  • In both conflicts, the teachers unions and their allies are looking to Sacramento, as well as voters, to approve more funds as a key element in making the agreements enforceable. But it is not clear where those funds would come from. Neither Gov. Gavin Newsom nor the Legislature has made any commitments beyond the funding increases that Newsom requested in his proposed budget in January.  In Los Angeles the strike did push the school board to place a long-delay tax on real estate parcels on a June 4 special election ballot.  If approved, it would help erase the district’s projected $500 million shortfall. Whether it will pass is another matter:  it will require voters to approve it by a two-thirds margin, which the last parcel tax measure nearly a decade ago failed to get.

Unaddressed in both Oakland and Los Angeles are deeper structural issues, such as the impact of declining enrollments, the crushing costs of meeting pension obligations, and stratospheric housing costs.

Whether these underlying forces will trigger further strikes — still a relatively rare event in California — is hard to predict. In only one other California district — San Ramon Valley Unified centered in Danville, a wealthy suburban community to Oakland’s east — have teachers actually authorized their union to call a strike if contract negotiations break down, although labor conflicts are brewing in other districts like Sacramento City Unified and Fremont Unified just south of Oakland.

The fact is that even with gains at  the bargaining table like those made in Oakland and Los Angeles, most teachers — and certainly beginning teachers who rely on a single income — will not be able to afford to buy a house in many urban and suburban districts, or even cover rents there.  (In the current salary schedule,teachers in Oakland with a B.A. degree make $46,570, which in three years would rise to just over $50,000 under the new contract.)

Those realities will make recruiting teachers an ongoing challenge, even as districts struggle to find teachers in key areas like math and science and special education. And it will continue to create churn in the labor force, with some teachers being tempted to leave so they can live in districts where living costs are lower — or to leave the profession altogether.

That may help explain the surprisingly large proportion of teachers in Oakland — 42 percent — who voted against ratifying the agreement.  This is one area where the Oakland strike outcome differed from Los Angeles, where only 18 percent of teachers voted against the contract. While making some significant gains at the bargaining table, many Oakland teachers sent a message that they were hoping for more.

Louis Freedberg writes about education reforms in California and nationally, and is the executive director of EdSource.

Despite Budget Crisis, Oakland Teachers Demand 12 Percent Raise


school busWith 95 percent of Oakland Unified teachers already having approved a strike that appears likely to begin Tuesday, the school district could face weeks of turmoil – unless, like Los Angeles Unified leaders did last month, Oakland Unified agrees to give substantial raises to teachers. But there are outside experts that think the district can’t afford to provide the raises.

The teachers union – the Oakland Education Association – wants a 12 percent increase phased in over three years. The district has offered a 5 percent raise over three years. The union and district have been unable to agree on a contract since the last one expired in 2017.

That’s at least partly because Oakland Unified is in a financial bind that is worse than many other districts. It has the same problem as other districts in dealing with the increasingly heavy annual cost of the Legislature’s 2014 bailout of the California State Teachers’ Retirement System. The bailout – phased in from 2014 to 2021 – requires school districts to increase by more than 130 percent their annual contributions to CalSTRS.

But Oakland Unified also has seen among the sharpest enrollment drops of any state school district, falling from 54,000 to 37,000 since 2003. Because state funds depend on average daily attendance, this has wiped out many non-mandatory programs.

Schools kept open despite huge drop in enrollment

Yet Superintendent Kyla Johnson-Trammell and other district officials have been leery of closing schools because of parents’ concerns, leaving nearly 11,000 empty seats in often half-full schools. They’ve also failed to significantly reduce administration and support staff even as enrollment has dropped by more than 30 percent.

That may change soon. According to a Bay Area News Group report, to free up money for raises for the district’s 3,000 teachers, the Oakland school board is prepared to lay off 90 administrators and nearly 60 school support workers to generate annual savings of $21.75 million. Oakland Unified officials say that this will not only pave the way for labor peace, it will help reduce the district’s structural deficit, which is otherwise on track to top $56 million by the 2020-21 school year. They have also vowed to follow through on staff recommendations that 24 schools be closed.

But a 2017 analysis by a state agency that helps school districts in financial distress raises a question that most local coverage of Oakland Unified doesn’t address: Can district staff be trusted to competently manage its $500 million-plus budget?

After looking at district budget information dating back to 2010, the Fiscal Crisis & Management Assistance Team (FCMAT) depicted the district as on track to a “fiscal emergency” because of its slowness to acknowledge, much less respond to, obvious problems. It noted that the school board had approved pay raises – including boosts of about 15 percent for teachers from June 2014 to January 2017 – without first identifying how they would be funded. FCMAT also cited “constant turnover” in key positions; a lack of district supervision of how schools deal with spending decisions; and an “abundance of budget exceptions granted to sites and departments that overspend.”

District hoping for emergency state loan

In the short term, the district has taken steps to secure an emergency state loan of $34.7 million. But as the EdSource website reported in September, the district still hasn’t fully paid off the $100 million emergency state loan it got in 2003.

State officials may feel that for political reasons, they have no choice but to help Oakland Unified again. But as FCMAT and others have noted, the district’s enrollment is expected to keep plunging – even as pension obligations keep growing. A 12 percent raise for teachers would only make achieving fiscal stability even more daunting for district leaders.

L.A. Unified school board members heard similar warnings last month, but chose to provide a 6 percent raise to teachers –just shy of the 6.5 percent the teachers union had wanted.

This article was originally published by CalWatchdog.com

Oakland teachers vote to authorize strike


OaklandOAKLAND — An overwhelming number of voting teachers authorized the Oakland teachers union to call a strike if salary negotiations break down with the school district, which already is facing another major disruption in the form of a $30 million budget deficit.

The 3,000 members of the Oakland Education Association voted from Jan. 29 through Feb. 1. Of the 84 percent of union members voting, 95 percent approved authorizing union leaders to call a strike if necessary, union president Keith Brown announced Monday.

“This is a clear message that our members are ready to fight for the schools our students deserve,” Brown said. No date was set, but the union expects if a strike were to occur it would happen by the end of the month.

Oakland Unified spokesman John Sasaki said Monday the district hopes that it doesn’t come to that. Though substitutes would be brought in to cover for striking teachers, a strike could be very disruptive to students, especially those preparing for end-of-the-year exams. …

Click here to read the full article from the East Bay Times

Oakland’s pot equity program withering on the vine

Marijuana smokingOakland’s long-touted program to help black and brown pot entrepreneurs succeed alongside bigger marijuana businesses is dead.

Officially, it’s around still. But it may as well not be.

The program was crafted so Oakland natives and longtime residents, especially those arrested and jailed for marijuana-related offenses during the failed war on drugs, could get a stake in the legitimized cannabis industry.

For two years, the city sold a dream to hundreds of hopeful people: 616 applicants sought assistance under the equity program as of last month, city records show. …

Click here to read the full article from the San Francisco Chronicle

California unemployment rate at record low 4.1%

JobsCalifornia’s unemployment rate dropped to 4.1 percent in September, a record low since it started tracking the number this way in 1976, the Employment Development Department reported Friday.

The Bay Area boasted the state’s lowest unemployment rates, falling below 3 percent in eight of the nine counties, all but Solano, where it was still under the statewide average.

The San Francisco, Oakland and San Jose metro areas all posted unemployment rates that were the lowest for the month of September since 1990. They fell below the lows set in September 1999, the peak of the dot-com boom.

Economists cheered the numbers, coming 10 years after the financial crisis that sent the country into a tailspin, but said they may be overstating the health of the labor market. Wage growth is still subpar, with benefits and bonuses making up a growing percentage of total compensation. And the labor force participation rate, which measures the percent of the adult population with a job, is markedly below where it was 10 year ago. This suggests that there are still discouraged workers sitting on the sidelines who could be pulled back into the labor force if wages were more enticing and employers more willing to hire them. …

Click here to read the full article from the San Francisco Chronicle

California cities top list of towns with worst roads in U.S.


road_blockCongratulations, California. The top three cities with the worst roads are all from the Golden State.

The nonprofit organization TRIP, which researches transportation issues, released a report on Wednesday listing the country’s roughest roads.

California drivers probably are not surprised by the findings, which state that the top three worst areas in the nation for rough roads comes from our state.

The San Francisco Oakland area – congrats to you, you’re No. 1. According to the report, 71 percent of the roads there are in bad shape.

San Jose came in second with 64 percent, and the Los Angeles area came in third with 57 percent. …

Click here to read the full article from ABC7 News

Oakland City Council Passes ‘Abolish ICE’ Resolution


OaklandOakland’s city council unanimously approved a resolution on Monday evening calling on Congress to abolish Immigration and Customs Enforcement (ICE).

Oakland Mayor Libby Schaaf made headlines months before Democratic-Socialist Alexandria Ocasio-Cortez (D) upset longtime Rep. Joe Crowley (D-NY) in a primary earlier this year when Schaaf alerted illegal immigrants in the Bay Area of impending ICE raids. Schaaf also signed a letter calling for ICE to be abolished.

Councilmember Rebecca Kaplan, who authored the resolution, told the East Bay Citizenthat “ICE’s actions have had ramifications in our own backyard.”

“ICE came into West Oakland and tore apart a family while falsely slandering them–claiming it was a criminal case–when they were filing a civil deportation action and no criminal charges,” she reportedly said. “We’ve now experienced enough of ICE telling lies, ripping apart families, and leaving guns loose where they get into the hands of murderers and spreading racism.” …

Click here to read the full article from Breitbart.com/California

Santa Clara and 49ers Developing Fractious Relationship


Photo Credit: Diane Cordell via Flickr

Photo Credit: Diane Cordell via Flickr

In 2010, when Santa Clara voters approved creating a city-run stadium authority to build an NFL stadium to attract the San Francisco 49ers, politicians patted themselves on the back for getting things done and luring a storied franchise 45 miles south to Silicon Valley. The relocation took place before the 2014 season.

The contrast with Oakland and its inability to come up with a stadium proposal that would keep the Raiders from eyeing other metro areas was clear. Leaders in the cash-strapped city were unable to prevent the Raiders from committing in 2017 to moving to Las Vegas and working with the Nevada state government on a financing plan that should yield a 65,000-seat stadium for the team to begin using in the 2020 season.

But now the narrative has taken a dramatic shift, and it’s Santa Clara leaders who are facing grief in their community over the 49ers’ arrival in town and the impact of the $1.27 billion Levi’s Stadium (pictured), named after the San Francisco company which paid for marketing rights.

What was billed as a win-win situation by team and local officials now looks far more complex. The initial honeymoon has long since given away to a fractious relationship.

The biggest annual strain is over how much the team must pay per season. A complex agreement set the 49ers’ rent and operating fees at $24.5 million for the 2017 season. The 2018 assessment was fought over for months before an arbitratorrecently said the amount should be set at $24.762 million for the coming season, an increase of just over 1 percent.

The ruling contradicted the team’s analysis of baseline rent, stadium operating expenses, debt service and capital reserves. The 49ers argued their total payment should be as little as $16.775 million – a 32 percent cut. The city asked for as much as $25.862 million – a 6 percent increase.

“We want to work with 49ers, not against them,” Mayor Lisa M. Gillmor said in a statement released after the arbitration decision. “Hopefully the team understands that Santa Clara will always put community interests first.”

There have also been squabbles over the city’s 10 p.m. weeknight curfew for events at the stadium, which has the potential to cause headaches for the team, given the regular season games the NFL holds each week on Monday and Thursday nights, as well as the preseason games that are regularly scheduled on weeknights. Some residents respond by citing quality-of-life issues created by team-related traffic.

Personal-seat license fees needed for revenue model

Both the city and the team share concerns over attendance. While the 68,500-seat stadium regularly sells out on paper, Pro Football Talk and other popular NFL websites took to mocking the 49ers last fall after an October game in which the stadium seemed less than half full, pushing ancillary revenues down. An unexpected problem has been the intense heatseen at Levi’s Stadium for several preseason and regular season games.

A five-game winning streak to end the 2017 season raised hopes that attendance will improve going forward. But as Pro Football Talk pointed out, the team and city have reason to be deeply worried about renewals for personal seat licenses, the expensive way that fans can guarantee themselves top seats at games.

The license fees are crucial to the revenue model being used to pay off construction and related debt. Many once-successful teams have struggled to sell PSLs after their fortunes took a turn for the worse.

Meanwhile, the long-shot hope that the Raiders would continue to have a presence in Northern California after their 2020 move to Las Vegas has been dashed. Nevada media outlets recently reported that the team is likely to move its preseason training camp from its longtime base in Napa to Reno that summer.

This article was originally published by CalWatchdog.com

Small Businesses Threatened by Potential Plastic Ban


On the corner of my block in Oakland sits a small eatery serving everything from donuts to Chinese food to barbecue. Its large picture windows with faded lettering tells you its age and the loyal following of customers it enjoys. Its status is all the more remarkable considering that a new shopping center with chains and restaurants is bustling with customers just two blocks down. The struggle to remain solvent in a changing neighborhood would only worsen if state legislation to ban polystyrene foam returns for a third year in a row. Adding to the burden of small business with the proposed ban is especially senseless when food container alternatives are on the rise organically.

Polystyrene containersThis small eatery was beating the odds against small businesses. It worked around Oakland’s $13.23 minimum wage by using its own labor and closing for a day or two per week. It survived possible rent hikes and attractive buyout offers for its storefront located on a major bus line and blocks from other transit options. Even more, its product stood out amidst a sea of assembly line food options. It was comfort food so conveniently located that even new residents like myself couldn’t resist. They piled the food high in white polystyrene containers that would keep it hot, no matter the walk or bus ride home.

Currently, 116 cities and counties in California enforce some type of polystyrene ban. The patchwork of municipalities that have banned polystyrene range in their scope. Some bans are for government organizations only; others have provisions to ease small businesses into the ban. There’s even a current ban in Oakland, with an exemption for small businesses or anyone who can prove that the requirements to provide a compostable food container item “would cause undue hardship.” However, this exemption isn’t as kind as it may sound, seeing as the steps to prove undue hardship are themselves imposing undue hardship. Owners have to produce financial records and anything else the city requires, taking additional time away from their business to prove their case to officials.

The bans, like the one in Oakland, typically require compostable or recyclable containers in place of polystyrene. Aside from the fact that polystyrene is recyclable in many municipalities, requiring compostable containers by law is enforcing behavior that is already being adopted by the restaurant industry without pressure from government. Large companies like Whole Foods and Chipotle serve their take-out food in compostable containers and have been before most bans were in place. They have taken advantage of their own economies of scale to absorb the additional cost. It is an advantage that makes them forerunners in purchasing first-run compostable products. In turn, compostable product companies develop newer and better products that lower in price over time.

With larger corporations leading the way next to municipal bans, further legislation, especially at the state level, would target the one area of a restaurant’s business that helps keep razor-thin margins from disappearing completely. The most recent failed legislation in the California state Legislature, Senate Bill 705, would have banned polystyrene food containers for restaurants, food trucks and grocery stores. By failing to exempt corner eateries and family-owned bodegas, SB 705, if passed into law, would unfairly punish these restaurants for using  polystyrene food containers and put them at a competitive disadvantage relative to large food vendors.

If anti-polystyrene legislation returns to Sacramento, it would be yet another hit to small businesses. Large corporations already set the example for non-polystyrene food container use while compostable options continue to grow. An outright ban is a solution to a problem that continues to shrink and a blow to the small businesses surviving in an era of increased regulation.

Those interested in cutting waste from landfills or the use of plastic in general would be better off campaigning for better recycling options for high volume polystyrene users and encouraging compostable options. They are much better options than supporting policy that unintentionally harms small restaurants woven into the fabric of communities across the state.

Martha Ekdahl is a Young Voices Advocate who writes about urban policy.