Web Version [link removed] | Update Preferences [link removed] CBRT in the News Lenny Mendonca Steps Down As Newsom's Business Adviser

Mendonca, an experienced business leader with a stunning resume, was arguably among the most seasoned and respected insiders in the administration where he'd worked since 2019. He had multiple titles and a huge portfolio as chief economic and business adviser, director of the Governor's Office of Business and Economic Development — GO-Biz — and chair of the California High Speed Rail Authority. The official announcement said Mendonca would be devoting time to family and personal issues, but made no further comment.

Rob Lapsley, who heads the California Business Roundtable, said Mendonca's tenure sent "a clear signal to the business community that [Newsom] wanted a steady hand who combined outstanding executive business experience with fair and balanced perspectives on major issues.'' Taking over for Mendonca: Chris Dombrowski, currently chief deputy director at GO-Biz will fill in as acting director, while High Speed Rail Authority Vice Chair Tom Richards will lead on that front.

Read More [[link removed]] Backers of “Schools and Communities First” Submit Record Breaking Number of Signatures for Inclusion on Fall Ballot

Backers of the Schools and Communities First Ballot Initiative didn’t let a little thing like a global pandemic stop them from submitting 1.7 million signatures to the California Secretary of State to earn a spot on the November ballot. The measure needs 50%+1 vote to pass. California’s fiscal analyst estimates it would raise an estimated $8-$12.5 billion a year for education and public safety by changing the state constitution and raising property taxes on California’s largest businesses.

“Now more than ever, we need to support those heroes on the front lines who have been caring for the most vulnerable, educating our children, and keeping Californians safe,” said Alex Stack, communications director for the Schools & Communities First campaign, in a press statement.

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In an interview with a Bay Area CBS News station, Rob Lapsley, co-chair of ‘Californians to Save Prop 13 and Stop Higher Property Taxes’, focuses on “The public employee unions behind the largest property tax increase in state history [that] are willing to spend and do whatever it takes to raise the cost of living for working families.”

Read More [[link removed]] Business Climate and Job Creation ‘A Long Way To Go’ Before There’s Enough Testing To Reopen Economy, Business Roundtable CEO Says

The United States needs to see increased testing for the coronavirus before businesses can begin to reopen, Business Roundtable President and CEO Joshua Bolten said Thursday.

“We’ve clearly got a long way to go, but there’s progress being made every day ... all the CEOs in our organization agree that testing is an absolutely crucial gating element to getting us back and running safely,” Bolten said on CNBC’s “Power Lunch.” “So everything we can do to expand the availability of fast and accurate testing is going to be probably the most crucial element to reopening promptly and safely.”

The lack of testing for the virus has been one of the main issues facing the U.S. during the pandemic, with many places limiting who could be tested as the virus spread across the country. The Centers for Disease Control and Prevention said tests it sent out early on were found to be defective.

Bolten said returning to a more normal economic environment should involve a “phased” plan in which some businesses open before others and that policymakers should be working on those arrangements now.

Read More [[link removed]] Small Business Emergency Relief Program Hits $349 Billion Cap In Less Than 2 Weeks

The $349 billion Paycheck Protection Program to boost small businesses during the coronavirus economic crisis has run out of money.

"The SBA is currently unable to accept new applications for the Paycheck Protection Program based on available appropriations funding," a Small Business Administration spokesperson said in an emailed statement Thursday. "Similarly, we are unable to enroll new PPP lenders at this time."

An online portal for lenders had an identical message as of Thursday morning.

The program was passed as part of the CARES Act, Congress' $2 trillion economic relief bill. The program was plagued by technical difficulties and delays from its opening on April 3.

On Wednesday, Treasury Secretary Steven Mnuchin and Small Business Administration Administrator Jovita Carranza urged Congress to appropriate more money for the program as soon as possible.

Read More [[link removed]] Small Business Relief Programs An Uncertain Maze

When Stuart Davis opened up City Wok in Palm Desert more than 25 years ago, he intended on making quality takeout and delivery a cornerstone of the business.

So when the coronavirus pandemic triggered a shutdown of restaurant dining rooms, Davis adapted with speed and efficiency. They already had the takeout boxes and delivery services. He laid off his waitstaff, a tough but necessary call to trim payroll and allow the workers to collect unemployment.

And he promptly applied for the federal Paycheck Protection Program from the U.S. Small Business Administration, so he could get forgivable loan proceeds that will help him cover his rent, utility bills, and fixed expenses.

But Davis still isn't sure when that money will come in.

Read More [[link removed]] The Next Economic Crisis Will Hit States And Cities

America's economic crisis soon may expand to its states, cities and towns.

The big picture: State and local tax revenue is falling, particularly in areas heavily reliant on sales taxes, while spending is up due to added unemployment and medical obligations.

Just look at Arizona, which is near the middle of the pack when it comes to sales tax as a percentage of total state revenue. It's been projecting a $1 billion surplus by the end of its fiscal year in June, but now expects a $1.1 billion deficit for the year ending June 2021.

Arizona has a relatively large rainy day fund, but it's not enough to cover the likely tax shortfall.

Read More [[link removed]] How Bad? “We’ll Get Back To You”

The good news: California has an $18 billion rainy day fund, the biggest in its history. The bad news: It’s likely gone, with cuts looming on the horizon.

“The pace of job losses that we are seeing in recent weeks … makes it clear that the economy has entered a recession, and possibly a quite severe one,” Legislative Analyst Gabe Petek said Thursday in the first legislative hearing since the coronavirus pandemic brought state government to a halt last month.

Petek: “It’s very likely that the state has gone from an anticipated surplus and is now likely facing a budget problem and potentially a significant one. Realistically, it will probably take several months for us to get a clear idea of the budget situation.”

Read More [[link removed]] IMF Warns Asia’s economy Will Not Grow At All In 2020

For the first time in 60 years, Asia as a region will not register any economic growth this year because of the coronavirus pandemic, according to forecasts by the International Monetary Fund.

“This is a crisis like no other. It is worse than the Global Financial Crisis, and Asia is not immune,” Chang Yong Rhee, director of the Asia and Pacific Department at the IMF, wrote in a blog post published on Wednesday.

“While there is huge uncertainty about 2020 growth prospects, and even more so about the 2021 outlook, the impact of the coronavirus on the region will — across the board — be severe and unprecedented,” he added.

Asia has been among the fastest-growing regions in the world. During previous crises such as the Asian financial crisis in 1997 and the global financial crisis around 2008-2009, the region still registered average growth rates of 1.3% and 4.7%, respectively, said the fund.

Read More [[link removed]] What Will ‘Back-to-Normal’ Look Like For California? Some Businesses Could Restart Before Others

How will California get back to normal amid the coronavirus outbreak?

There will be no getting back to normal anytime soon, with the new coronavirus unlikely to ever be completely eradicated, and a vaccine 12 months to 18 months away under the most optimistic scenario.

Certainly, society will be opened back up eventually. But the process is likely going to be slow and methodical — guarding against new outbreaks in an effort to prevent a resurgence even worse than what California is experiencing now, but also focusing on starting to reopen the economy.

Depending on various models, the peak in cases in California could come anytime between mid-April and the end of May.

Read More [[link removed]] ‘National Security Issue’: What Congress Wants To Give Farmers For Coronavirus Downturn

Don’t let bought-out grocery shelves fool you — farmers are having a lot of trouble because of the novel coronavirus.

They’re seriously hurting if their main income came from selling products to schools, restaurants, amusement parks, sports arenas or any other enterprise that shut down to slow the spread of the virus. Dairy farmers, for instance, have seen a 30 to 40 percent decrease in the prices they receive as huge buyers of milk and milk products shut their doors.

Farmers are “price takers, not price makers,” as Rep. Jim Costa, D-Fresno, a longtime almond farmer, put it.

Read More [[link removed]?] Bay Area Hotel, Resort, Convention Job Losses Skyrocket

The coronavirus economic avalanche has buried the leisure, travel, and entertainment sectors in the Bay, Area and nearby regions with a swarm of more than 10,000 in job losses, an analysis of state labor filings shows.

The largest job losses in the region that were reported recently to state officials were unleashed by the layoffs instituted by Pebble Beach Co., which chopped 1,800 positions, and by TeamSanJose, which reduced staffing by 1,300, according to a review by this news organization of state Employment Development Department documents.

Updated filings show that from mid-March through the evening of April 10, companies in the Bay Area had filed WARN notices for current or upcoming job cuts that totaled approximately 20,700, according to official documents sent to the state EDD.

Of that Bay Area total, the hospitality, hotel, convention, and resort sector accounted for about 10,065, or a staggering 48.6 percent of all the employment reductions disclosed to the EDD.

Read More [[link removed]] San Joaquin Valley Farmworkers Fear Working — And Not Working — Amid Coronavirus

Maria Camacho sews homemade coronavirus face masks and sells them to friends and neighbors.

It’s how she makes money since losing her job in a Kern County vineyard a few weeks ago. She said her employer cut the workforce, keeping only the workers with the most seniority. She said her family’s lucky her husband was one of the workers who kept his job.

They’re part of California’s more than 420,000 farmworkers considered essential to the economy while millions of others stay home to stem the spread of the coronavirus pandemic.

The COVID-19 illness that spread in mid-march through the central San Joaquin Valley caught many farmworkers by surprise. Already facing the rainy season and some shortages in seasonal work, the coronavirus could devastate farmworkers, many of whom go without healthcare and have no savings to fall back on.

According to state data, fieldworkers made just under $800 a week on average in 2019. Farmworkers who spoke to The Bee said they are bracing for the worst.

Read More [[link removed]] Energy and Climate Change Should Newsom Ban Fracking?

Five dozen climate, health and environmental organizations have sent a letter to Gov. Newsom, urging him “to reject the efforts by the oil industry to exploit this emergency as an excuse to roll back regulatory oversight.”

The groups urged Newsom to roll back the Geologic Energy Management Division’s recent decision to resume issuing permits for fracking, and to reject a call from the California Independent Petroleum Association “proposing that you reverse your effort to improve the oversight capabilities of CalGEM to provide enhanced field enforcement of regulations and protections at oil field operations and to evaluate the state bonding requirements for oil operators,” the letter said.

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The petroleum association’s chief executive officer, Rock Zierman, put out a statement in response to the letter, stating, “CIPA has asked the state to take reasonable action to protect the economy, stabilize our energy security, and ensure California meets its climate goals by continuing to produce the cleanest oil on the planet. The state can take prudent action today to stay on track with our climate goals and keep oil workers on our companies’ payrolls rather than on taxpayer-funded public assistance programs that are already overwhelmed.”

Read More [[link removed]] California, Rest Of The West Sinking Into A Rare Mega-Drought, Scientists Say

California’s crushing five-year drought came to a welcome end after record rain three winters ago. Or did it?

Although forests are greener, reservoirs are fuller and widespread water restrictions are gone, many believe the past few years, in which there was pretty decent rainfall, were just a blip on a troubling long-term skid into drier times.

A group of scientists now says that the American West, including California, has been in the midst of a prolonged drought since the beginning of the century — one on par with only four mega-droughts experienced over the past 1,200 years and one capable of causing major social upheaval.

The last mega-drought that the researchers describe, between 1575 and 1593, is believed to have forced Native Americans to relocate whole communities from sprawling mesas to lower river valleys in search of water. The mega-drought before that, in the 1200s, is thought to have contributed to the fall of the cliff-dwelling Anasazi civilization in the Southwest.

Read More [[link removed]] More Than 100,000 Clean-Energy Workers Lost Their Jobs in March

Nate Otto is selling fewer rooftop solar systems these days.

Business is down about 50% from a record-setting first quarter for Otto’s Palm Springs-based solar installer, Hot Purple Energy. But he hasn’t fired any of his 48 employees, or cut their salaries. He’s been giving them odd jobs — cleaning trucks, adding security lights — even as he limits the number of people at job sites and takes steps to keep them as far away from each other as possible.

“I’ve done everything I can just to keep the guys busy,” he said.

Otto’s employees are some of the lucky ones.

A report out Wednesday from Environmental Entrepreneurs, a clean energy advocacy group, finds that more than 106,000 clean energy workers filed for unemployment benefits in March — a number that has almost certainly grown over the last few weeks.

Read More [[link removed]] Russia's Coming After America's Shale

As the world bounces between crises, from the fast-spreading coronavirus to a fresh crush of refugees at Europe’s borders, President Donald Trump found this “good” news to tweet early Monday. A rapidly escalating battle between Saudi Arabia and Russia on oil production has sparked the biggest crash in crude prices in nearly three decades. Yet the battle is far closer to home for Americans than you might think.

Riyadh’s just a proxy. Russia’s real war is with the U.S. shale oil industry.

Brent crude, the global benchmark, was down 24 percent by the end of Monday, at just over $33 a barrel. Oil prices in the U.S. were down 34 percent, to a little above $27 a barrel. Indeed, if it weren’t for the fact that travel’s probably not your top priority at the moment — we hope washing your hands is — now would be a good time to fill the car tank, press the accelerator and head off on a long road trip.

Read More [[link removed]] A World Locked Down And Drowning In Oil

The world is short on many things we need — masks, tests, toilet paper — yet we’re too long on one thing we suddenly don’t need much: oil.

This oversupply crisis is, understandably, lost on people. We’re locked down with nowhere to go, not seizing cheap pump prices, struggling to manage our grave new world and mourning loved ones afflicted by the coronavirus.

Even though most of us aren't paying attention, the havoc the pandemic is wreaking on the global oil industry by choking demand will ripple out into the broader economy, and eventually affect many of us.

Read More [[link removed]] Education and Workforce Development California State University Suspends SAT/ACT Testing For 2021-22 Admissions, Joining UC

Applicants to the 23-campus California State University won’t have to submit scores from the SAT or ACT for admission in fall 2021, and the following winter and spring terms, according to an announcement released Friday.

Coming after a similar action by the University of California on April 1, the move means that both of California’s enormous public university systems have suspended standardized testing in the admissions process because of hardships caused by the pandemic.

Like the UC action, the CSU move was portrayed as a temporary emergency one, not implying a permanent end to standardized test requirements, officials said. “This temporary change will ensure equitable access to the university, and should provide some measure of relief to prospective students and their families,” CSU chancellor Timothy P. White said in a statement.

Read More [[link removed]] No L.A. Unified Student Will Get An ‘F’ On Spring Report Card

No students will receive failing grades on their spring report cards, Los Angeles school officials announced Monday, taking an assertive step on student assessment decisions confronting school systems across California.

The bold move is the latest decision to reshape education in response to the coronavirus pandemic that has shuttered California schools and forced distance learning for about 6.2 million students. Actions have included canceling “mandatory” standardized tests, relaxing college admission requirements and turning Advanced Placement tests into take-home exams.

Concern over the ability of all students to access and benefit from online coursework tipped the scales for the L.A. Unified School District’s no-fail decision. In a concurrent move, officials said that a student’s grade will be no worse than what it was on March 13, the final day of campus-based instruction. But it could improve: Teachers are expected to devise reasonable opportunities for students to improve their grades.

Read More [[link removed]] UC San Diego Might Stick With Online Instruction This Fall Due To Coronavirus Crisis

UC San Diego Chancellor Pradeep Khosla said Thursday that the school might stick with online courses for the fall quarter due to the coronavirus, but that he doesn’t see it becoming a permanent arrangement.

He said the University of California system is considering the option for its undergraduate campuses and that UC executives will make the final decision.

“I think (staying with online) is completely within the realm of possibility,” said Khosla, whose school has nearly 39,000 students.

“We have not made a decision about the fall quarter yet. We are looking at multiple models and have activated a continuity of education task force, a continuity of research task force and are also working with public health experts to help inform such a decision in concert with the UC system.”

The California State University system is weighing the same option for its schools, including its campuses in San Diego and San Marcos. Those two schools collectively serve nearly 50,000 students.

Read More [[link removed]] Infrastructure and Housing A Renters’ Market: Power Shifts From Landlords To Tenants With Evictions Off the Table In California

It was Jamie Bagley’s first apartment without roommates: a newly refurbished one-bedroom in downtown Oakland with sunlight streaming into the living room and a patio for her collection of outdoor plants.

At $2,195 per month, the veteran hairdresser felt like years of hard work were finally paying off. She moved in on February 9.

Then came the coronavirus, and, one by one, clients canceled appointments. Her income dried up. Now, Bagley, 42, is worried she may have to leave the apartment she worked so hard to rent.

“It seemed like I had just landed, that I finally had just come to this point in life where I was starting to get ahead,” Bagley said. “Now when I look into the future, it looks like I might have some hard decisions to make.”

Bagley is one of thousands of Californians who didn’t pay rent this month — a number that’s only expected to grow the longer workers are ordered to stay home. She and fellow renters are safe for now: On April 6, the state Judicial Council suspended new eviction filings for 90 days after the state of emergency is lifted.

Read More [[link removed]] Real Estate Experts Talk COVID-19 Impacts On Tech, Government And Economy

The coronavirus changed how — and even if — Silicon Valley works following statewide and regional orders to stay home. But real estate insiders say it may change the way employees work long after the outbreak, too.

“I truly believe the biggest change coming out of the COVID-19 pandemic of 2020 will be the downsizing of businesses and the realization that the remote working arrangements work,” said Sean Cottle, a real estate attorney for San Jose-based Hoge Fenton. “That’s going to cut down on the long commutes from the Central Valley to the Bay Area.”

Cottle, along with a panel of real estate experts, on Tuesday laid out the ripple effects the Bay Area’s shelter in place order has had on real estate — and by extension the economy — during a virtual event hosted by The Silicon Valley Organization and moderated by Steven Kahn, a real estate attorney with Hoge Fenton

The full economic impacts of the coronavirus, which causes a deadly respiratory illness known as COVID-19, won’t be known for at least a couple more months, the panelists agreed.

Read More [[link removed]] LA County Approves Rent Assistance Program

The Los Angeles County Board of Supervisors voted unanimously Tuesday to allocate additional emergency funding to assist struggling renters and expand tenant protections during the coronavirus pandemic.

County supervisors Janice Hahn and Hilda Solis proposed the program last Thursday that would set up an emergency rental assistance program with Community Development Block Grant funds they hope will be provided as part of the next round of the federal CARES Act.

“As we fight the spread of this virus and do everything we can to save lives, this crisis has devastated families who were already living on the brink of poverty,” Hahn said.

The proposal came a day after city councilman David Ryu launched a renters outreach program meant to help educate renters and landlords on their new rights during the coronavirus crisis.

Read More [[link removed]] Caltrans Is Speeding Up Highway Projects While Coronavirus Keeps Californians Off The Road

As state and local officials extend stay-at-home orders, road construction crews across California are taking advantage of reduced traffic to speed up projects.

Contractors said they are working during the day instead of at night, extending work hours and closing longer stretches of road at a time under temporary agreements with the state Department of Transportation and local agencies.

“There’s recognition that we can get more done with less traffic for sure, and that’s happening,” said Ed Herrnberger, an executive vice president at Teichert, a Sacramento-based construction company. “I’d say that’s consistent industrywide.”

Traffic is down 36 percent on average in urban areas across the state, said Matt Rocco, a Caltrans spokesman.

Read More [[link removed]?] Local Tax Officials To Accept Applications For Penalty Waivers

The penalty for not paying property taxes by the April 10 deadline could be waived for those experiencing financial hardship as the result of the coronavirus outbreak, local officials said.

"I understand that this is a very stressful time, especially for those suffering direct effects from this public health crisis, and my office is committed to helping in any way we can. Los Angeles County property owners affected by the COVID-19 virus may have late penalties cancelled if they are unable to pay their property taxes by the April 10 deadline," Los Angeles County Treasurer Keith Knox said in a statement released on the county tax website.

“We encourage all property owners who can pay their taxes on time to do so. This is a critical source of revenue that keeps the government running and providing vital services the public relies on including emergency response, public health and our schools”, Knox added.

Read More [[link removed]] $388 Million In Federal Help For Bay Area Airports, Large and Small

Airports in the Bay Area and Monterey County are in line for nearly $400 million in federal assistance to help keep the travel hubs aloft during the economic tempest unleashed by the coronavirus.

Separately, the largest U.S. airlines have reached an agreement in principle with the U.S. Treasury Department for a $25 billion bailout in the form of a payroll support package, Southwest Airlines, American Airlines, United Airlines, Delta Airlines, JetBlue, and Alaska Airlines are among the major airlines that agreed to the bailout.

The money for the local airports is being made available through a $10 billion program within the CARES Act signed into law by President Donald Trump in late March and is designed to bolster airports that are being buffeted by the coronavirus fallout.

Read More [[link removed]] Editorial and Opinion Changing Prop. 13 Will Generate A Tax Bill That Will Harm Small Businesses, Especially Those Owned by Minorities

Many opponents of the original Proposition 13 have never given up.

The same groups that fought the ballot measure more than four decades ago when 65 percent of the state’s electorate passed it have repeatedly tried to destroy the measure’s important property tax protections.

When Prop. 13 was on the ballot in 1978 I opposed it, but the voters approved it. As chair of the Assembly Revenue and Taxation Committee, I had a responsibility for the legislative implementation of Prop. 13 to make it work.

However, in the decades following Prop. 13’s implementation, I’ve come to recognize the law’s many benefits. For homeowners, small business owners and employers – large and small – Prop. 13 has provided stability, predictability and certainty. This certainty is even more important for the 46 percent of California businesses that are owned by racial minorities including African Americans.

Read More [[link removed]] Split Roll Measure Is Just A Pension Bailout

Earlier this month, proponents of a split roll property tax system submitted 1.7 million signatures to place a revised version of an already qualified measure on the November ballot. Now more than ever, given the deleterious impact of COVID-19 lockdowns, split roll can only be understood as what it’s always been: a pension bailout.

Year after year, the state of California has boasted of record-breaking budget revenues. The problem is that it’s also boasted of record-breaking spending. Many local governments and school districts have unfortunately experienced a similar pattern.

Strong economic and revenue growth helped mask the crowd-out created by rising pension costs, and helped incumbents buy time as projected pension cost increases only got worse.

Read More [[link removed]] It’s Not Just Renters. Landlords Need Help, Too

A growing number of states and cities have enacted eviction moratoriums to protect tenants from losing their homes if they can’t pay the rent during the coronavirus emergency.

This is just common sense. Governments have ordered businesses to close and people to shelter in place to avoid spreading COVID-19; it would be cruel and counterproductive if people who’ve lost their jobs and their incomes also lose their homes.

But this temporary reprieve is not easy to grant or without pitfalls.

Most moratoriums simply halt evictions for non-payment. Tenants will eventually have to come up with the rent payments they missed. If they can’t pay off their rent debt, they’ll still face eviction and hardship. Tenant groups are pushing governors in California, New York, Washington and other states to go further and use their emergency powers to fully cancel rent obligations until communities reopen. And others are calling on tenants to withhold payments in a coordinated rent strike on May 1 to force the issue.

Read More [[link removed]] Emergency COVID-19 Rules Effectively Give California's NIMBYs Unlimited Time To File Anti-Housing Environmental Lawsuits

The COVID-19 outbreak might be a disaster for most of the globe, but it's proving to be a windfall for California's NIMBYs who are being provided with new legal tools for delaying real estate developments.

Last week, the Judicial Council of California—the rule-making body for the state's courts—issued 11 emergency rules for the judicial system during the current pandemic.

Included in the council's rules was a blanket extension of deadlines for filing civil actions until 90 days after the current state of emergency ends. Ominously for housing construction, this extended statute of limitations applies to lawsuits filed under the California Environmental Quality Act (CEQA).

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The law has become a favored tool of NIMBYs and other self-interested parties to delay unwanted developments or to extract concessions from developers. Anti-gentrification activists use CEQA to stop apartment buildings that might cast too much shadow. Construction unions use the law as leverage to secure exclusive project labor agreements.

Read More [[link removed]] A Dark Economic And Fiscal Tunnel

Gov. Gavin Newsom says he sees light at the end of the coronavirus tunnel, when Californians regain “a semblance of normalcy,” emerge from their homes, converse verbally rather than electronically and return to their jobsites.

The date of that happy day is still very uncertain. Moreover, true recovery also will require Newsom and the state he governs to traverse another dark tunnel of severe economic recession and state and local government budgets swollen by crisis-related spending while experiencing declining tax revenues.

Last week, Newsom’s Department of Finance released a preliminary report on the state budget. “The economic disruption from the pandemic is expected to result in a recession and have significant negative effects on state revenues,” it said. “Concurrently, the drop in the stock market may cause further revenue declines.”

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]