Web Version [link removed] | Update Preferences [link removed] CBRT in the News Should California Continue With Its High-Speed Rail System? Influencers Weigh In

Gov. Gavin Newsom, like Jerry Brown and Arnold Schwarzenegger before him, strongly believes that a high-speed train that whisks passengers from Los Angeles to San Francisco in less than three hours is a vital part of California’s transportation future.

“Californians have told us loud and clear: They want to invest in environmentally friendly and socially responsible transportation options that will let them go places quickly and safely,” said Lenny Mendonca, Newsom’s appointee as chair of the California High-Speed Rail Authority. “Fast trains, jobs and a transportation option you can feel good about – high-speed rail is the future.”

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California Business Roundtable President Rob Lapsley praised the possibilities for high-speed rail, but he also expressed concern about the potential cost.

“Other nations have a shown that high-speed rail has great potential for our future… but residents in the highest-taxed state in the nation are becoming increasingly skeptical that major technology and infrastructure projects, including high-speed rail, continue to be over budget with major delays,” said Lapsley, who praised Newsom’s approach since taking office. “High speed rail must show it can produce long-term jobs and attract major new employers to the region or it will jeopardize support for major projects in the future.”

Read More [[link removed]] Bernie Sanders Endorses 2020 California Initiative To Change How Commercial And Industrial Properties Are Taxed

On July 25, 2019, U.S. Sen. Bernie Sanders (I-Vermont) spoke at the United Teachers Los Angeles (UTLA) Leadership Conference in Los Angeles, California, where he endorsed a ballot initiative to change how the state levies taxes on commercial and industrial properties and allocate the revenue resulting from the change to local governments and school districts. The ballot initiative has qualified for the election on November 3, 2020. UTLA is a supporter of the ballot initiative and has provided the campaign Schools and Communities First, which is behind the proposal, with $435,000.

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Opponents of the ballot initiative include the California Business Roundtable, California Chamber of Commerce, and California Taxpayers Association. Rex Hime, president of the California Business Properties Association, stated, “California already has the worst climate for business and job creation in the country. A split-roll property tax will just increase pressure on many businesses that are already finding it hard to make ends meet.”

Read More [[link removed]] Business Climate and Job Creation Confident Consumers Keep Spending Amid Soft Inflation

Consumers continued to spend at a healthy clip and stayed confident heading into the summer while inflation remained soft, data that will likely reinforce the Federal Reserve’s expected decision to lower interest rates later this week.

Personal-consumption expenditures—a measure of household spending on everything from airline tickets to furniture—increased in June to a seasonally adjusted 0.3% from the prior month, the Commerce Department said Tuesday. The Fed’s preferred inflation gauge, the PCE price index, rose a seasonally adjusted 0.12%, which is below the monthly pace needed to hit the central bank’s 2% yearly inflation target.

Meanwhile, a measure of consumer sentiment rebounded in July, suggesting Americans remain confident about the U.S. economy despite persistent trade tensions and slowing global growth. The Conference Board, a private research group, said its index of consumer confidence jumped to 135.7 in July, up from 124.3 in June.

Read More [[link removed]] U.S. Economy Maintains Steady Jobs Growth

Steady U.S. hiring growth continued into the second half of 2019, providing a solid foundation for the decadelong economic expansion at a time of global headwinds.

Nonfarm payrolls rose by 164,000 in July, the Labor Department said Friday. The jobless rate last month held at 3.7%, near a 50-year low.

Average hourly wages for private-sector workers advanced a sturdy 3.2% from a year earlier, up slightly from the prior month’s pace.

The job market overall is healthy, a meaningful counterweight to anemic global growth and trade tensions that prompted the Federal Reserve to cut interest rates Wednesday by a quarter-percentage point.

“Today’s jobs report provides reassurance to Fed policymakers that despite a weakening global economic picture and an ongoing trade war with China, the U.S. labor market remains strong,” Glassdoor economist Daniel Zhao said in a note to clients.

Read More [[link removed]] Mortgage Rates Were Falling Before Fed Signaled Rate Cut

The Federal Reserve is prepared to cut interest rates this week for the first time since 2008, but the biggest source of debt for U.S. consumers—mortgages—has been getting cheaper since late last year.

Mortgage rates have fallen recently to the lowest levels since late 2016, tracking a broader slide in U.S. Treasury yields. The average rate on a 30-year, fixed-rate mortgage was 3.75% last week, down from 4.94% in November, according to Freddie Mac .

“The most significant impact of an expected Fed rate cut is already upon us,” said Greg McBride, chief financial analyst at Bankrate.com, referring to the drop in mortgage rates.

The decline contrasts with trends in other consumer rates since the Fed last tweaked monetary policy in December by raising its benchmark federal-funds rate by a quarter-percentage point to a range between 2.25% and 2.5%.

Read More [[link removed]] Trump Threatens New Chinese Tariffs, Rattling Investors Across Markets

President Trump moved Thursday to extend tariffs to essentially all Chinese imports, escalating a trade conflict that is now poised to hit U.S. consumers in the pocketbook.

The new tariffs would take effect Sept. 1 and cover $300 billion in Chinese goods—including smartphones, apparel, toys and other consumer products. They would come on top of tariffs already imposed on $250 billion in imports from China.

“If they don’t want to trade with us anymore, that would be fine with me,” Mr. Trump told reporters of the Chinese. “Until such time as there is a deal, we’ll be taxing them.”

Wall Street was rattled by the news, with stocks falling sharply and erasing earlier gains as hopes slip for an end to the yearlong trade dispute.

Read More [[link removed]] Families Go Deep In Debt To Stay In The Middle Class

The American middle class is falling deeper into debt to maintain a middle-class lifestyle.

Cars, college, houses and medical care have become steadily more costly, but incomes have been largely stagnant for two decades, despite a recent uptick. Filling the gap between earning and spending is an explosion of finance into nearly every corner of the consumer economy.

Consumer debt, not counting mortgages, has climbed to $4 trillion—higher than it has ever been even after adjusting for inflation. Mortgage debt slid after the financial crisis a decade ago but is rebounding.

Student debt totaled about $1.5 trillion last year, exceeding all other forms of consumer debt except mortgages.

Read More [[link removed]] States Where Residents Have The Highest Levels of Mortgage Loan Debt

Affordability is a concern for many Americans in the U.S. housing market Opens a New Window. – and as prices rise, so has mortgage Opens a New Window. debt.

Outstanding mortgage balances during the first three months of the year rose once again, according to credit reporting agency Experian, to a new record high of $9.5 trillion – “well above” levels reported during the peak of the housing crisis.

The average U.S. debt owed by an American borrower in the first quarter was $202,284 – a 2.4 percent increase over the same period the year prior.

Researchers noted rising debt might not be a surprise when home price appreciation is taken into account. The average sales price for a new home rose 46 percent over the past decade – during the same timeframe, household income has risen just 3 percent.

On the plus side, however, delinquency rates have largely been on the decline.

Read More [[link removed]] America's Top States For Business In 2019

To rank CNBC's 2019 America's Top States for Business, we put all 50 states through a rigorous test and graded them based on more than 60 measures of competitiveness in 10 broad categories. Each category is weighted according to how frequently states use them as a selling point in economic development marketing materials. That way, our study ranks the states based on the attributes they use to sell themselves.

CNBC's criteria was developed with guidance from a diverse array of business and policy experts and official government sources, along with input from the states themselves. And our metrics are based on publicly available data from a variety of sources. As in years past, some states tied in several categories. Learn more about our categories and methodology here.

Read More [[link removed]] California Businesses Are Heading To Arizona

Arizona is open for business, a fact becoming more apparent with each new company setting up shop in the state.

Arizona Governor Doug Ducey says, “burdensome regulations and crippling costs” are driving both large and small businesses to move to Arizona and take advantage of the state’s innovative-friendly regulation, low taxes, qualified workers and high quality of life.

“With a booming economy, budget surplus, talented workforce, low regulation and tax environment, and unbeatable quality of life, it’s no wonder business leaders increasingly want to come to Arizona,” Gov. Doug Ducey (R-AZ) said in a statement. “The word is out on Arizona. We are open for opportunity. And we will continue to implement smart policies that grow jobs and allow us to continue investing in the things that matter.”

For the last four years, Chief Executive Magazine has ranked Arizona in the top ten best states for business. California has continuously ranked last.

Read More [[link removed]] California Migration: The Story Of 40 Million

California, it has been written, is America, “only more so.” How much more so? That’s a complex question — and an important one. From immigration laws to school spending, some of our biggest decisions depend on an accurate count of this giant state’s population — of who we are, of whether we’re coming or going and of what we need from each other and our government.

Nationally, California’s population numbers determine how many seats we get in Congress. That clout is partly why our stakes are so high for the 2020 census. They also carry cultural and economic weight. One American in eight is a Californian, and as we go, so goes our economy.

These numbers tell stories: As a state we are getting richer, for instance, because the working class is fleeing the high cost of living. They define choices: How we prioritize government services is being impacted by the twin dynamics of a slowing birth rate and an aging population.

Read More [[link removed]] California’s Other Fiscal Crisis

Gov. Gavin Newsom and his predecessor, Jerry Brown, have repeatedly stressed the need to build state budget reserves to cushion the impact of the next recession, whenever it hits.

Thanks to a vibrant economy, they’ve squirreled away nearly $20 billion in various reserve accounts. When recession hits, however, the state budget is not the only fiscal system to take a big hit.

As the Great Recession of the previous decade revealed, payments to unemployed workers also gets hammered. In fact, the California Unemployment Insurance Fund, according to a report from the U.S. Department of Labor, is the least solvent of any state’s and even a tiny economic downturn would quickly drive it into the red.

History tells us how that came to pass.

During Gray Davis’ governorship, which began in 1999, he and the Legislature sharply increased unemployment benefits without raising payroll taxes to pay for them.

Read More [[link removed]] CalPERS Loss Triggers More Debt Payment Reform

Investments earning 6.7 percent during the fiscal year that ended June 30 might seem like a good return, particularly after an alarming stock market drop at the end of last year.

But for CalPERS it’s a loss that creates new pension debt.

The big pension system currently needs earnings of at least 7 percent to balance its books for the year. So the small loss, .3 percent, creates a new layer of debt to add to the many layers of debt from previous years with investment losses.

The difference this year, however, is that under a reform adopted by the CalPERS board last year new debt from investment losses will be paid off over 20 years instead of 30 years, saving money in the long run.

The .3 percent loss will mean different dollar amounts of new debt when applied to the roughly 3,000 CalPERS pension plans, which vary in size and funding status. The plans cover state workers, most cities and counties, special districts, and non-teaching school employees.

Read More [[link removed]] UC And Union Reach Tentative Labor Deal Offering 20 Percent-Plus Raises Over 5 Years

The University of California has reached a tentative contract agreement with the union representing roughly 13,000 health care, research and technical employees, giving them wage increases of 20 percent or more over a five-year period, a university representative said Wednesday.

The University Professional and Technical Employees-Communications Workers of America 9119 began voting on the contract on Tuesday, and that will continue through Aug. 7 on UC campuses all around California.

“We are very pleased to have reached these agreements with UPTE, giving our employees the competitive pay and excellent benefits they so deserve,” said Peter Chester, the university’s executive director of labor relations, in a prepared news release. “These employees make significant contributions to UC’s mission and we deeply appreciate their hard work and dedication.”

Read More [[link removed]] Local Pension Costs Grew In California At Nearly Six Times National Rate, New Data Shows

Median pension costs for local governments grew nearly six times as much in California as the rest of the country over a decade, according to new data compiled by a UC Berkeley professor.

Median pension costs went up $7,022 per employee in a selection of cities and counties in California from 2007 to 2016, compared to a national median increase of $1,216, Sarah Anzia, an associate professor of public policy, said Wednesday in Sacramento.

The rising pension costs have consumed an increasing share of local government revenues, absorbing an additional 2 percent of general revenues over the 10-year stretch in California compared to a national median of 0.7 percent, according to Anzia’s data.

Read More [[link removed]] Energy and Climate Change Worried About Wildfires, Californians Ready To Spend, Vote To Fight Climate Change

The majority of Californians believe global warming is happening now and that it’s a serious threat to the Golden State’s future, according to the results of a poll released Wednesday. What’s more, Californians are ready to cast their votes and spend their money to fight it.

The findings from the Public Policy Institute of California, a non-partisan think tank that’s asked Californians for their take on environmental issues for nearly two decades, suggest Californians place a high value on the environment and want the state to fight to protect it.

The Institute found 78 percent of Californians think it is somewhat to very important to them for California to lead the charge to fight climate change. The issue was especially key for Democrats, with 69 percent saying it was very important compared to 46 percent of Independents and 24 percent of Republicans.

Read More [[link removed]] Flooding From Climate Change Threatens $50 Billion In Bay Area Property: Study

Billions of dollars in Bay Area real estate could be at risk of flooding due to rising sea levels, according to a new analysis.

By the year 2050, Bay Area homes worth about $50 billion are at "grave risk" of coastal flooding, according to the study by Zillow and Climate Central.

If nothing is done to combat global warming, more than 80,000 properties could be underwater by 2100, the study found.

Across California, more than 140,000 homes are threatened by rising see levels. There's an interactive map that shows which sections of the Bay Area are most vulnerable.

Alameda County has more than 21,000 properties that could be underwater, the most in the Bay Area.

Read More [[link removed]] Electric Scooters Are Good For The Environment, Right? Here's Why It's Not So Simple

In March, Joe Hollingsworth hopped on a Lime scooter and zipped across the campus of North Carolina State University. At the end of the ride, a message appeared on the screen: “Your ride was carbon free.”

The pronouncement embodied the climate-friendly marketing of e-scooter companies like Lime and Bird. But it puzzled Hollingsworth, then a graduate student in environmental engineering, and his advisor, Jeremiah Johnson.

Sure, scooters don’t have a tailpipe. “But you have to think about the other things that are required to have the scooter ready, charged and available for you to use,” Johnson said.

So he and his students decided to tally up the full environmental impact of electric scooters over their lifetimes. The results, published Friday in the journal Environmental Research Letters, suggest that e-scooters aren’t quite as eco-friendly as they may seem.

Read More [[link removed]] California's Biggest Oil Spill In Decades Brings More Defiance Than Anger From Locals

Near the jagged western edge of Kern County, where the Temblor Range gives way to a landscape of steam pipes, fuel lines and bobbing pump jacks, there’s a definite mood in this dusty little oil town: Defiance.

Hardly a day goes by without reports of the growing oil leak in nearby Cymric oil field. So far, more than 900,000 gallons of oil and brine have oozed from a Chevron Corp. well and filled a dry creek, creating a hazardous black lagoon.

The residents of McKittrick, population 145, understand why people are upset by the images. Also, there’s no avoiding the worry that prolonged exposure to crude oil might one day trigger health issues.

But judging from the rowdy talk over cold beers and a blaring jukebox at Mike and Annie’s Penny Bar — a watering hole for thirsty oil field hands that has over a million pennies glued to the bar, floors, walls, television and entrance — the locals see a different story playing out.

Read More [[link removed]] Workforce Development California Teachers Association Loses Thousands Of Members After Faculty Association Decides To 'Disaffiliate'

Ending a decades-long connection, the association representing California State University faculty has severed its ties with the California Teachers Association, resulting in a significant loss in membership for the state’s largest teachers union.

In a little noticed move, the board of the California Faculty Association voted in late May to “disaffiliate” from the CTA. The association, whose members include faculty, part-time lecturers, librarians, counselors and coaches on the 23 CSU campuses, is an affiliate of the CTA, which means that its members can be CTA members as well.

The CTA wields considerable clout educationally and politically the state. Defying predictions that the Janus ruling by the U.S. Supreme Court a year ago would eviscerate public employee unions by limiting the fees they could collect, the CTA says it has added new members, as have many other unions across the country. The CTA anticipates that some 22,000 new members it says it has recruited over the past year will offset the approximately 19,000 CSU staff the CTA says belonged to both the faculty association and the CTA. The CTA says its overall membership will remain around 325,000.

Read More [[link removed]] California State University Adds $10 Million To Boost Math And Science Teacher Preparation In California

To address a persistent teacher shortage in math and science, the California State University system is pumping $10 million into its Mathematics and Science Teacher Initiative over the next four years.

While enrollment in teacher preparation programs in California has increased in recent years, the majority of districts are still struggling to fill teaching positions. According to the Learning Policy Institute, 75 percent of 211 California districts surveyed in 2016 couldn’t find fully prepared teachers.

The shortage of math and science teachers is a particularly challenging. California will need to add at least 33,000 new math and science teachers within the next decade, according to a 2016 report by the Mathematics and Science Teacher Initiative.

Read More [[link removed]] With Less Than Half Of Prospective Graduates In Los Angeles District Eligible For California State University System, College Trustees Eye New Requirement

The California State University system this week is considering a new admissions requirement for incoming freshmen — a development that’s sparked opposition from L.A. Unified, a district where less than half of the prospective graduates are eligible to apply under current standards.

CSU’s Board of Trustees on Tuesday will review an informal proposal to add a fourth year of “quantitative reasoning” to admissions requirements across the system’s 23 campuses. A quantitative reasoning course largely centers on problem-solving using math-based skills; a high-level math class, certain science courses or an elective with “a quantitative reasoning foundation,” such as statistics and personal finance, could all qualify, according to the proposal. Three high school math courses— Algebra I, Geometry and Algebra II — are already a must for CSU admissions.

System advocates say the extra prerequisite, which wouldn’t be implemented until 2026, would ensure that more students build a strong learning foundation before college and have a wider array of career opportunities. Some other public university systems, such as Arizona State and Texas State, have adopted a similar requirement.

Read More [[link removed]] Recognizing Regional Costs In School Funding Formula Is Both Equitable And Affordable

Everyone talks about the dramatic cost difference between California counties, but does nothing about it. Children in the poorest districts in the wealthiest counties pay the price of our inaction. Many do so unnecessarily.

Let’s review what we know.

Does the cost to run a school differ around the state? Yes. Over 80 percent of school funding is related to personnel. No Californian expects to get by on the same income in San Francisco as in Fresno or Bakersfield. The most recent of many studies on California’s regional cost differences documents a “bare bones” budget for a family of four in San Francisco ($123,442) that is over twice as high as one in Fresno ($59,440) or Bakersfield ($57,898) — indeed, twice as high as in 22 of California’s 58 counties.

How does California’s school funding scheme, the Local Control Funding Formula (LCFF), handle San Francisco’s high costs? It doesn’t. The formula is identical throughout the state. This forces school districts like San Francisco to spend a disproportionate share of their time juggling budgets and finding funding. Administrators beat the bushes for money — parcel taxes, funding from the city, grants — while trading off class size, staff experience, competitive pay, clerical support and building maintenance. This sometimes leads to tensions between schools with higher and lower PTA funding.

Read More [[link removed]] Infrastructure and Housing Housing Affordability Crisis Spreads To The Midwest And Other Lower-Cost Areas

Low mortgage rates and thriving employment should be the recipe for a strong housing market. Instead, they’re deepening America’s affordability crisis.

What began on the coasts, in areas such as New York and San Francisco, is now radiating into the nation’s heartland and to cities such as Las Vegas and Charleston, S.C. Entry-level buyers are scrambling to purchase homes that are in short supply, sending values soaring.

Expectations that the Federal Reserve will cut interest rates this week will do little to change the sober reality: For many, prices have risen much faster than incomes, pushing homeownership out of reach for a new generation of hopeful buyers. That’s cooling the market, with the 2019 spring season shaping up as the slowest for sales in five years, according to CoreLogic Inc.

Read More [[link removed]] California Has The Most Homeless People Of Any State. But L.A. Is Still A National Model

With tens of thousands of homeless people living on the streets, Los Angeles officials have increasingly found themselves as the subject of criticism for what many Angelenos see as a failure to keep up with a problem that seems to be getting worse.

But across the country, L.A. isn’t considered to be a failure. To the contrary, at last week’s National Conference on Ending Homelessness in Washington, D.C., attendees repeatedly held up both the city, the county and the state as models of political will for getting people into housing.

“I think there’s actually incredibly strong things happening across California,” said Matthew Doherty, executive director of the United States Interagency Council on Homelessness. “In Los Angeles, there are some of the best permanent supportive housing providers in the country, with some of the most innovative projects, engagement of the public health system directly in the work of homelessness, the city-county partnership... There’s a lot that’s going on there.”

Read More [[link removed]] San Francisco And Seattle: A Tale Of Two Cities Fighting A Homeless Crisis

Apartment manager Larry Gothberg cleans the sidewalk in front of his building on Hyde Street, in the center of San Francisco’s Tenderloin district, on a block the New York Times called the "dirtiest block in the city.”

“The filth on street is disgusting -- this isn’t just dirt,” he says.

He turns his hose and sprays out human feces in one of the planter boxes.

“If I don’t do this, it won’t get done.”

He says the City of San Francisco used to hose down the sidewalk just a few years ago in the Tenderloin, a 30-block area with the highest concentration of the city’s homeless street dwellers.

San Francisco counted 9,784 homeless in this year's Point in Time Count; that is nearly 1% of the city’s population. Of the city’s 11 supervisorial districts, District 6, where Tenderloin is, counted 3,659. By comparison, District 4, the city’s more wealthier Sunset District, had 43.

Read More [[link removed]] Southern California Home Sales See Record Drop In Prices, Hamptons Not Far Behind

Southern California’s housing market Opens a New Window. saw a sharp decline in sales last month, as the median price Opens a New Window. hit a new high.

According to recent research from data analytics company CoreLogic, about 20,790 new homes and condos were sold during the month of June in San Diego, Los Angeles, Ventura, San Bernardino and Orange counties. That is a decline of 6.9 percent from the month prior and a drop of 8.8 percent from the same period last year.

New home sales in the Southern California counties notched their weakest June since 2014.

In the region, sales of newly-built homes were 46.9 percent below the average for the month since 1988.

“Despite … a healthy economic backdrop, the market was sluggish, suggesting many would-be buyers remained priced out or concerned about buying near a possible price peak,” Andrew LePage, a CoreLogic analyst, said in a statement.

Read More [[link removed]] Newsom Signs Bill Requiring Further Environmental Review For Cadiz Project

A bill signed Wednesday evening by Gov. Gavin Newsom will require Cadiz Inc.'s Mojave Desert groundwater pumping project to undergo further review to show it will not harm the surrounding environment.

The bill, SB 307, was authored by Sen. Richard Roth, D-Riverside, and cleared the Assembly earlier this month. It requires the State Lands Commission to determine that projects involving the transfer of water from a groundwater basin won't adversely impact the surrounding environment.

If built, Cadiz's project would pump more than 16 billion gallons of groundwater from an aquifer under the Mojave Desert across public lands to the Colorado River Aqueduct to transport it to residents. The company has projected the project could earn them $2.4 billion.

In a statement, Newsom said the bill will ensure an independent scientific analysis is conducted and reviewed publicly.

Read More [[link removed]] Editorial and Opinion How Latinos Can Help In The Fight Against Climate Change

In California, climate change is a personal issue. We seem to be experiencing its earliest effects much more dramatically than the rest of the country.

But Latinos are truly on the front lines. Construction, farming, manufacturing all draw heavily on Latino workers, and they are at greater risk when they must work in extreme weather conditions. Many of these workers develop health issues.

In the context of changing climate, this pronounced inequality in healthcare has wrought terrible consequences on Latino families as well. Hispanic children suffer from asthma at similar rates as non-Hispanics, but they are 70% more likely to be admitted to the hospital and twice as likely to die from asthma.

Read More [[link removed]] Why A $15 Federal Minimum Wage Is Just What California's Economy Needs

It’s time to cut Texas, North Carolina, Nevada and Colorado down to size.

They are among the states that are successful at siphoning jobs from California, arguing they are more business friendly as well as less costly places to conduct business.

A big part of that are wages. And while most businesses that relocate and expand typically pay above the California minimum wage that is now at $12 an hour on the way to $15 by 2022, the $15 benchmark the Golden State is headed to is roughly twice the minimum wage of the states that peel off jobs from California.

There is now, however, an all states minimum wage push that is being pursued on the federal level.

Read More [[link removed]] California Business Roundtable 1301 I Street, Sacramento, CA 95814 916.553.4093 | [[link removed]] Web Version [link removed] | Update Preferences [link removed] | Unsubscribe [link removed]