Latest Capitol Update – January 22, 2018

As Democratic Majority Worries About A Wealthy Exodus from California, Democratic Legislators Introduce a New Business Tax

With the passage of the federal tax bill, California Governor Jerry Brown has signaled that by cutting off deductions that benefit the wealthy, California’s richest families may decide to leave the state for better tax havens.

“People with higher incomes pay a lot more money, and some of them may be tempted to leave,” Gov. Jerry Brown said when he unveiled his 2018-19 budget proposal last week. “This was an assault by the Republicans in Congress against California.” (Adam Aston, “Wealthy Exodus to Escape New Tax Rules Worries California Democrats,” Sacramento Bee, 1/18/18)

California’s wealthiest pay 48 percent of the state income taxes and the departure of a just a few wealthy families could have a devastating impact on the state general fund.

In an effort to prevent departures, Senate pro tem Kevin de Leon introduced a bill allowing California residents to write off their state taxes on their federal returns as a charitable deduction. But officials from the Trump administration have warned that this exercise will not be allowed by the IRS and could lead to penalties.

Ignoring the governor’s concerns, two Democratic State Assembly members Kevin McCarthy (Sacramento) and Phil Ting (San Francisco) introduced an Assembly Constitutional Amendment (ACA 22) that would raise corporate taxes on California companies with revenues higher than $1 million.

Liam Dillion with the Los Angeles Times quoted McCarthy, “I’ve seen enough billionaire justice in the first 11 months of this presidency to last my lifetime. At a time when reckless federal tax policy favors billionaires over middle-class workers, ACA 22 will help ensure that California can continue to grow and support middle-class families throughout the state.”

The Democrats seem to be divided on how to handle the potential exodus of wealthy families, but which one will benefit California’s economy the most?

 

California Attorney General Threatens To Fine California Employers $10,000 Who Comply With Federal Immigration Agencies

California Attorney General Xavier Becerra warned California employers that his office would fine any employer $10,000 who is caught directing the federal authorities to a specific person or group of people for immigration purposes. Becerra indicated that the only way an employer is able to provide employee information is through a court order or subpoena. If neither of these were presented, the employer is engaging in unfair immigration-related practices.

Patrick McGreevy, Los Angeles Times reporter quoted Becerra saying, “It’s important, given these rumors out there, to let people and more specifically employers know that if they voluntarily start giving up information about their employees in ways that contradict our new California laws they subject themselves to actions by my office … enforcing AB 450.”

Becerra also indicated that his office is preparing “to issue guidance to local agencies” about California’s new state immigration law for distribution to companies.

 

San Francisco Assemblyman Introduces Legislation To Ban Gas Vehicles in California by 2040

Democratic Assemblyman Phil Ting (San Francisco) has introduced Assembly Bill 1745, which bans the sale of internal combustion passenger vehicles in California by 2040.

Commercial vehicles weighing more than 10,000 pounds would not be affected by this legislation. Consumers who already own a gasoline-powered vehicle would not be driving illegally, but they would not be able to register any after 2040. The bill only proposes a ban on the registration of new cars or trucks that is not considered a zero-emission vehicle.

The legislation is a way for Ting to help boost electric vehicle sales in order to meet California’s car emissions goals. Critics of the ban state that the legislation hurts the middle-class and poorer motorist who may not be able to afford to buy an electric vehicle.

 

Tampons Tax-Free Bill Fails Again

For the third straight year, Assemblywoman Cristina Garcia’s (D-Gardens) legislation to exempt tampons from sales taxes in California has failed.

 

New Harassment Legislation Gives Victims Years to File a Complaint

Assemblywomen Eloise Reyes (D-Grand Terrace), Marie Waldron (R-Escondido) and Laura Friedman (D-Glendale) introduced Assembly Bill 1870, which gives victims up to 3-years after a harassment occurs to file a complaint with the California Department of Fair Employment and Housing. The current law only gives a year to file a complaint on any unlawful employment or housing practices.

 

Joel Fox: A Pandora’s Box: Suing Oil Companies, Consumers Pay

Some members of the Los Angeles city council hope to join San Francisco, Oakland and New York City in suing oil companies on the principle that the costs associated with climate change are a burden to the city and its taxpayers. If successful, this would open a Pandora’s box of problems for companies and the government itself. Not to mention, it would add to taxpayers’ financial burdens rather than relieving them of costs.

If the cities are banking on the idea that the lawsuit will force companies to contribute to the government coffers, they’re neglecting to realize that the taxpayers will ultimately pay the price.

The requirements for companies to participate in the cap and trade program with the goal of clearing up the environment would come with a cost, which eventually passes on to consumers. The Legislative Analyst declared that the cap and trade extension would cost consumers up to 79-cents per gallon of gas by 2031.

Read Full Article Here: http://www.foxandhoundsdaily.com/2018/01/pandoras-box-suing-oil-companies-consumers-pay/

 

California May Circumvent Feds By Imposing Healthcare Insurance Requirement

The federal penalty for those without insurance expires at the end of this year. The bad news however, uninsured California residents may still be penalized with a new proposal led by state lawmakers.

Elizabeth Aguilera with CalMatters wrote, “‘Everything they are doing at the federal level, we are doing the opposite,’ said state Sen. Ed Hernandez, an Azusa Democrat who chairs the Senate Committee on Health and plans to host a bill-pitching session next week. ‘What drives individuals to purchase on the exchange is the marketing, but also the subsidies and the health care,’ Hernandez said. ‘We are looking at every option.’”

Read Full Article Here: https://calmatters.org/articles/california-may-buck-congress-health-insurance-requirement/

 

Tuition at the University of California Could Rise Again

This week, the Regents of the University of California, a governing board for the university system, is expected to increase tuition and fees an extra $342, to $12,974 at their next meeting in San Francisco.

As students began protesting, UC officials were quick to point out that California undergraduates whose families make less than $80,000 pay no tuition.

 

Apple Announces Plan To Bring Home $252 Billion From Overseas

In a dramatic move, Apple plans to invest more than $350 billion into the US economy over the next five-years by bringing home $252 billion from overseas, building a new campus, creating more than 20,000 jobs and issuing each of its employees a bonus of $2500.

The news comes after President Donald Trump’s tax reforms contained a deep discount in repatriation taxes for “bringing cash home from overseas.”

In a statement, Apple CEO, Tim Cook, said, “Apple is a success story that could only have happened in America, and we are proud to build on our long history of support for the U.S. economy. We believe deeply in the power of American ingenuity, and we are focusing our investments in areas where we can have a direct impact on job creation and job preparedness. We have a deep sense of responsibility to give back to our country and the people who help make our success possible.”

Republicans seem Anxious for a ‘Dreamers’ fix by year’s end

Republicans in tough congressional seats really seem anxious for a Dreamers fix by the end of the year. While I remain hopefully, I am not sure it will get done, because we have a ton of foot dragging and too many political games being played by all sides. 
Check out this article by the Washington Post

Wisconsin Gov. Scott Walker moving forward with plan to drug test food stamp users

Not sure what to think about Wisconsin seeking to drug test food stamp recipients. Will this impact the children? What drugs? Pot, Coke or other drugs? How often? The recipients should be forced to enter job training, volunteer and other programs that get them back into the workforce.
Here is the link to the article:

The Crumbling Moral & Ethical Pillars of American Society

Hector Barajas sits down to speak with the Cowboy Libertarian, Patrick Dorinson, to discuss the severe crisis in America that is threatening to crumble the already weakened foundations of our Republic. It is the moral and ethical crisis that has been building for many decades, which we can no longer avoid.

You can follow Patrick Dorinson, The Cowboy Libertarian, here:

Facebook: https://www.facebook.com/cowboy.liber…
Twitter: https://twitter.com/CowboySense
Website: http://cowboylibertarian.com

Trump’s Immigration Program Creates Higher Construction Costs, Better Wages in Texas

Fox News reports that President Donald Trump’s immigration policies are creating higher housing costs and adding to the paychecks of Texas construction workers.

Casey Stegall writes, “Just how bad is it? According to the National Association of Home Builders, more than 56 percent of developers nationwide are reporting labor shortages… Ted Wilson with Residential Strategies, Inc. has run the numbers. ‘We’ve seen direct construction costs climb by over 30 percent,’ Wilson said, ‘and a lot of that is directly attributed to what builders are having to pay their subs and trades in wages.’ Meaning, with so few workers out there, construction companies have had to pay more to attract them, which adds to the cost of a home.”

Labor shortages are increasing both the price of homes and the time required for them to be built.

To answer the need for construction workers and help keep home prices affordable, the Wall Street Journal reported recently that Trump’s Department of Homeland Security raised the annual cap on H-2B visas by more than 20 percent to 81,000 this July. H2-B visas are used to permit temporary entry into the country of non-agricultural skilled and unskilled laborers. As the Journal reported, “The majority of workers receiving this type of visa also are from Mexico,” a reference to a parallel 20-percent rise in H1-A agricultural worker visas to 160,000.” 

The Human Cost of Our Pollution-Free, First-World State

In the Democratic Republic of the Congo, 40,000 children work daily in the mines picking and checking the rocks for presence of “chocolate-brown streaks” of cobalt, an essential raw material necessary for the batteries that power electric vehicles.

Barbara Jones of the Daily Mail recently wrote that, “Almost every big motor manufacturer striving to produce millions of electric vehicles buys its cobalt from the impoverished central African state. It is the world’s biggest producer, with 60 per cent of the planet’s reserves. The cobalt is mined by unregulated labour and transported to Asia where battery manufacturers use it to make their products lighter, longer-lasting and rechargeable.”

Jones continued, “Cobalt is such a health hazard that it has a respiratory disease named after it – cobalt lung, a form of pneumonia which causes coughing and leads to permanent incapacity and even death. Even simply eating vegetables grown in local soil can cause vomiting and diarrhea, thyroid damage and fatal lung diseases, while birds and fish cannot survive in the area.

No one knows quite how many children have died mining cobalt in the Katanga region in the south-east of the country.” http://www.dailymail.co.uk/news/article-4764208/Child-miners-aged-four-living-hell-Earth.html 

California just enacted a $3-billion state subsidy program specifically for electric cars made by Tesla Motors. Tesla’s production will soon reach its limit for federal tax rebates, good for the first 200,000 electric vehicles sold in the United States. Business Insider noted, “Given Tesla’s ambitious U.S. sales forecast for its Model 3, it will hit the 200,000 vehicle limit in 2018, after which the phase-out begins. A year later, the subsidies are gone. Losing a $7,500 subsidy on a $35,000 car is a huge deal.”

A big deal indeed: When Hong Kong discontinued its equivalent subsidy, Tesla’s sales in the Chinese city dropped from tens of thousands to ZERO.

Todd C. Frankel of the Washington Post wrote that, “Most Tesla models use batteries from Panasonic, which buys cobalt from Southeast Asia and Congo. Replacement batteries for Tesla are manufactured by LG Chem.” 

As California’s political leaders herald electric vehicles as the future backbone of our state’s private transportation system, they must not forget Barbara Jones’ cautionary warning: “Free from pollution, such ideals mean nothing for the children condemned to life of hellish misery in the race to achieve its target.”

Time to Amazon California’s Food Supply

California’s elites have seized on Amazon’s purchase of Whole Foods with a demand of Amazon CEO Jeff Bezos: “revolutionize the nation’s food system” by demanding that its food come from local organic farmers and ranchers, with the goal that food “can never be cheap.”


The big question that the rest of us, non-elite, have to ask: How much of a dent in our wallet will this “food revolution” cause?

To answer that question, Alice Waters, a Bay Area chef who brought seasonal and organic food to her restaurant Chez Panisse in Berkeley, California, recently told the Washington Post, “People [need to] understand that food can be affordable, but it can never be cheap.” Waters then went on to talk about having shoppers pay $28 for an organic chicken.

The current average price for a whole chicken at Costco, Safeway, and WinCo Foods is around $8.50 – $13.00.

The food snobs like Waters don’t seem to understand that not everyone can afford to pay $28 for a whole chicken. The same goes for our fruits and vegetables.

The goal should be to make all food readily available for everyone. This includes our middle and working class communities that live in urban and rural areas that may not have easy access to grocery stores.

In California alone, it is estimated that more than a million people live in food deserts, meaning that they do not have easy access to a grocery store.


A few years ago, national and regional grocers worked together with First Lady Michelle Obama “to bring fresh foods to impoverished neighborhoods by opening and expanding more than 1,500 U.S. grocery stores in those [food desert] areas.” Also, “In California, a $200-million California FreshWorks Fund will provide financing at or below market rates to encourage grocers to set up shop in under-served communities.”

In 2015, United Ways of California issued a report, Struggling to Get By, where they found that 31% of California households did not have sufficient income to meet their basic costs of living. That includes 51% of Latino households and 40% of African American households. In addition, just over half of all California households with children under the age of six fall below the Real Cost Measure.


If people want to pay $75 at Chez Panisse for some sheep’s-milk ricotta and amaranth greens ravioli with basil and a grilled duck breast, it is their decision. But most Californians are living paycheck to paycheck and are just struggling to get by.

As Amazon revamps our food delivery system, it should devote itself to making fresh produce available for all – not designer organic food that only the Alice Waters types can afford.

The Activists Are Coming: How California Real Estate Companies & Property Owners Can Prepare for Attacks on Their Businesses

By Hector Barajas & Stevan Allen

California’s housing community is under attack by activists who have organized renters, foreclosed homeowners and minority based groups to help stage press conferences, local media interviews and protest marches under the banner of housing and tenant rights.

Too many property owners, real estate companies and housing organizations are caught flatfooted and don’t have a strategy when they see their reputations disparaged on the evening news.

In the past two years, three of our clients were confronted by various housing and renter activists’ organizations. These were not organic community groups, but rather orchestrated movements funded by the nation’s largest foundations, political contributors and politically motivated NGOs. Their aim was never really about helping tenants. Rather their hidden agenda was really about stopping development, putting pressure on lawmakers to regulate banking institutions and trying to strong-arm the U.S. Department of Housing & Urban Development (HUD) and the Federal Housing Finance Agency (FHFA) to sell their distressed properties to nonprofits and “mission-driven” organizations.

Pushing back on attacks from housing/tenant activists is crucial. It begins by being prepared, having a game plan in place and adhering to the following tips:

  • Everything Needs to be Written Down. How long has the tenant been in the property? How long since they last paid rent? Are there any complaints against the owner for health and safety reasons? Have you made any “cash-for-keys” offer?
  • Develop a Timeline. When dealing with the purchase of a foreclosed property, you need to have a timeline put together – from delinquency to the recent sale of the property. In California, the average foreclosure process takes 429 days and 1,123 days for a property to go from the delinquency stage to when the home is sold to a new owner; the entire process takes well over three years. By outlining the entire process and the current situation, the reporter(s) will get to better understand your side of the story and be more critical of highly emotional arguments activists tend to promote.
  • Put a Communications Plan in Place. Work with internal communications staff or outside consultants to develop protocols, draft media statements, approval processes, designate a spokesperson and identify third-party advocates who can speak on your behalf.
  • Run Everything Through Your Attorney & Public Affairs Team. Talk with your team to avoid any potential libel claims and to avoid any confusion of terms and dates in the timeline that you developed. All external communications should be vetted and approved in accordance with the communications plan.
  • Don’t Talk with a Reporter at the Property in Question. It could be a set up. The last thing you want is to get shouted down by the activists and elevate an already hostile situation. Avoid any direct confrontations. The activists will be videotaping everything. You will be made to look defensive, callous and as though you’re trying to hide something or avoid the truth.
  • Be Proactive, Tell a Story & Protect Your Reputation. We advise our clients to begin documenting their story. Develop YouTube clips of when you purchased a distressed home. Document the neighborhood, the condition of the property, and every step taken to get the home suitable for sale. Then, record the journey of the new homeowner from when they start the loan process, to the day she or he gets the keys to their new home – follow up a year later to get their testimonial. Populate your social media platforms with: newspaper articles where you are quoted, awards or events where you have been recognized for helping the local community, memberships in community based organizations, memberships in nonprofits and images of you leading a seminar on ethical property management.

With the advent of digital media, there are a tremendous amount of social media sites where you can write, manage and house your material. You need to build vast amounts of goodwill, should you have the unfortunate luck of dealing with California’s housing and tenant activists. Without any archived videos, news stories and/or testimonials, you are just playing defense, until the legal system runs its course and your reputation will suffer.

It is highly likely the activists will become more aggressive in the coming year. The good news is that real estate companies, property managers and housing organizations have positive stories to tell and can develop an effective plan that will help them respond to any attack. The key is to plan ahead and don’t wait until the protestors are on you doorstep before you start dealing with a potential crisis.

Hector Barajas & Stevan Allen are partners at Merino, Barajas & Allen, a California strategic communications and public affairs firm. http://www.MBAINC360.com 

PoliticFact does a PolitiHack Job on Oroville Dam Crisis

Chris Nichols of PolitiFact recently looked at a claim by Assemblyman Travis Allen that the current Oroville Dam crisis “was entirely avoidable.” Here are the comments Nichols purportedly reviewed:

The Oroville dam failure was entirely avoidable: California passed a $7.5 Billion water bond in 2014 but Jerry Brown didn’t spend $1 on new water storage or improvements to existing infrastructure like Oroville,” Allen said in a press release on Feb. 13, 2017.

Nichols rated the claim by Allen “mostly false,” but here’s where Nichols/PolitiFact got it wrong:

First, Nichols uses the environmentalist FERC complaint to argue out of both sides of his mouth, that, on the one hand, ‘it was anticipated” and on the other, “No one could have known.” These are Nichols’ exact words: “But there’s no evidence, at this point, that state officials knew the dam’s main spillway was in jeopardy, something Allen does not point out.”

So, Riddle Me This, Batman: Nichols tries to distinguish between operating and managing without explaining how come there are PHOTOS showing obvious water seepage and repairs being made on the main spillway in 2013 at the exact point of the initial crater formation, something managing the dam entails, but operating it does not.

2013_Oroville

Just Ask An Expert: Anyone who know structural concrete construction — or anyone making a simple phone call to someone who works in large-scale concrete project construction — knows that if water is flowing or seeping under the foundation, slumping, cracking and failure are not far in the future.

Management, Not Operations: With a dam holding over 3 million acre-feet a few yards upstream, finding the source of that water seeping was a matter that should have been of great concern. It apparently wasn’t. That’s a management decision, not an operational one (operators control how much water goes down the spillway, into the hydropower plant, etc.).

It is also management’s responsibility to note that the generator outflows would be compromised in the event of the emergency spillway filling the river channel with debris from the unpaved hillside (as pointed out to FERC and DWR in the environmental complaint). Proper planning for such debris dams would be to raise the generator water outlet height or install a check dam between the dam’s base and the main spillway to prevent sediment and debris from eddying upriver to clog the generator plant outlets.

Again, that’s management’s decision to make, not operations.

Proposition 1 Water Storage Bond Funds: Nichols was also critical about Assemblyman Allen’s comment that, “Jerry Brown didn’t spend $1 on new water storage or improvements to existing infrastructure like Oroville.”

Nichols concludes that, Allen’s additional claim that the state has yet to spend bond money on new water storage projects, ignores the fact that that money was precluded from being spent until December 2016.”

Proposition 1 Water Bond (2014) specifically excluded funds from being spent until December 2016.  What Nichols ignores is that the Prop. 1 was passed two years ago and with a 5 year drought, and currently floods, there still isn’t a single project listed on the state website as appropriate for funding.

It’s over two months since Proposition 1 money COULD be spent. With all the emergencies, water needs and shovel ready projects, you would think that the state would have broken ground January 1st.

There is also $168 million left in the Burns-Porter Act authorization, for which local needs and flood control were included in its purpose. With money in hand, no one seems to be leading by setting dam safety as a priority in the state budget, along with other decaying infrastructure.

Politifact’s Conclusions Are: MOSTLY FALSE: They ignore critical facts that give an entirely different impression. 

PolitiFact owes Assemblyman Travis Allen an apology, a retraction of its review and I give Chris Nichols 4 HATCHETS for his hack job on this story.

hatchethatchethatchethatchet

 

Xavier Becerra Gets No Love

Setting aside the snub of hiring Eric Holder to do the job Attorney General Xavier Becerra is supposed appointed and confirmed to do, Senate Pro Tem Kevin de Leon was recently on Univision’s weekend political show Conexión. DeLeon talked about immigration, Donald Trump, defending California’s rights and the like. He mentioned Eric Holder several times, but failed to mention Xavier Becerra.

If California politics was a 90’s sitcom, Becerra would be Screech from “Saved by the Bell” – he is part of the cast, but no one seems to cares.

screechxavier

Transcript and video file below:

TV Anchor Jairo Diaz Pedraza: Thank you very much Sergio Flores. Well we have the senator, the president [pro tempore] of the Senate, Kevin de León to answer these questions about the contract with Eric Holder for legal help in case of the possible… a possible trial against the Trump administration. Welcome Mr. León.

Senate President Pro Tempore Kevin de León: Thank you Jairo!

Jairo Diaz Pedraza: Tell us… tell us why hire Eric Holder?

Kevin de León: Well, I think that the candidacy of the President-elect is a threat, a real threat to our community, of the real interests of a great state like the great state of California. As the leader of the Senate, my role was to accept everything to defend the rights of our policies on the environment, climate change, health care, and the defense of the human rights of immigrants. I decided with my colleague, the Speaker of the Assembly, Anthony Rendon to contract the legal services of the ex-prosecutor of the country, the whole country of the United States under President Barack Obama, Mr. Eric Holder. To give us strategic legal tactics forbetter said, about what you can and cannot do to an administrator who continues to threaten the values of a great state like the state of California.

Jairo Diaz Pedraza: How much will the state of California be paying Mr. Holder?

Kevin de León: It’s $25,000 a month. We split half of this bill, $12,500, from the Senate and $12,500 from the Assembly. But I think that…

Jairo Diaz Pedraza: For four years or for how long?

Kevin de León: For three months.

Jairo Diaz Pedraza: Three months.

Kevin de León: And then we are going to re-negotiate. I think that it’s a payment, or [rather] a small investment in comparison to what is at stake. We have billions of dollars hanging by a thread right now.

Jairo Diaz Pedraza: With the decision of President Trump?

Kevin de León: [Yes,] with the decision of President Trump.

Jairo Diaz Pedraza: For example, how much would you take away? How much are we talking about Senator?

Kevin de León: It can be billions; it can be twenty, forty, sixty billion dollars. It’s not known yet, for example…

Jairo Diaz Pedraza: In which sectors?

Kevin de León: In medical care, the ACA that is the health care coverage of President Obama. It’s $20 billion that we receive every year for the more than 6.5 million people that are already enrolled in this medical care program.

Jairo Diaz Pedraza: Sure.

Kevin de León: Of Obamacare. If the plan is to destroy and diminish the funds, as soon as possible, according to the statements of the Republicans in Congress as well as President-elect Trump, we will be left with a $20 billion dollar deficit in the budget in the state of California. That is true.

Jairo Diaz Pedraza: Senator, There are 800,000 undocumented people who obtained their driver’s licenses. The federal government could demand the government of California to hand over all that information of the undocumented [people] for them to be able to locate and deport them.

Kevin de León: Look, [let’s] make this very clear, because I was the one who negotiated the driver’s licenses for the more than 800,000 people that can drive their cars today without the fear, without the terror, of having their car confiscated by a tow truck. Or much worse, being deported for being undocumented. The files, the personal data, are at this moment frozen in the records of the state of California. So that means, in a nutshell, if the federal government comes and says that they want access to that data, we will not give it to them. Now or later, today or tomorrow, or the next day, we will not hand over that data because that is personal data that belongs to the state of California, not the federal government.

Jairo Diaz Pedraza: In 30 seconds Senator, a message for the undocumented [people] that are going to live these next four years with Donald Trump.

Kevin de León: Well, we have to organize, we have to do everything possible, and my role is to do everything possible to defend the interests, promoting the necessary polices. In defense matters in a given case, if there are raids, massive deportations, the local police will not cooperate with the federal government. [We will] intervene in the deportation[s]. If someone has a crime, for example: a violent criminal, a violent bandit, an assassin, a [drug] trafficker, that’s another thing. But the majority of our working people are hardworking people.

Jairo Diaz Pedraza: Thank you very much Senator Kevin de León for being here on Conexión California

Kevin de León: No Jairo, it’s a pleasure for me. Thank you very much.

Jairo Diaz Pedraza: Thank you very much. Let’s take a break.

Video Filehttps://youtu.be/dDqfNiZRDl4