Web Version [link removed] | Update Preferences [link removed] CBRT in the News POLITICO: California Playbook, October 9, 2019

— HOUSING LAW HAILED: Newsom, appearing in Oakland on Tuesday, signed what was described as the nation’s toughest tenant protection law — AB 1482, sponsored by Assemblyman David Chiu — while kicking off a tour to promote legislation and state spending aimed at addressing California's housing shortage.

... WHY IT MATTERS, via POLITICO California’s Jeremy B. White: “The fact that AB 1482 made it to Newsom’s desk is a significant victory for Newsom, who campaigned on ameliorating California’s housing crisis and helped strike a late-session deal after the legislation appeared to be in peril.

“While California’s real estate lobby has historically been able to block rent control measures, exemptions for new and single-family homes helped win over groups like the California Apartment Association and the California Business Roundtable, which was actively whipping votes. With the law in place, rent increases will be limited to 5 percent annually through 2030. Landlords will need to show just cause to evict tenants and offer rental relocation assistance or waivers.

“Lawmakers approved the bill despite fierce opposition from the California Association of Realtors, which argued that the measure would exacerbate a housing crunch by stymieing construction of new rental housing — setting the governor and legislative leaders against a powerful lobbying group.“

Read More [[link removed]] Gov. Gavin Newsom Signs Law Capping Rent Increases In California

Gov. Gavin Newsom has signed a law that caps rent increases for some people over the next decade as the nation's most populous state grapples with a housing crisis.

The governor held a signing ceremony Tuesday in Oakland, an area where a report earlier this year documented a 43 percent increase in homelessness over two years.

Newsom called this moment “profoundly important” as California battles its housing affordability crisis. But he said the Legislature must do more next year to encourage new housing development.

“The fact that we are leading the nation in trying to meet this moment is a point of pride,” he said. “And it is a point of principle that we need to continue this kind of energy to focus on increasing that supply.”

...

The California Association of Realtors also opposed the deal. The California Business Roundtable and California Apartment Association, supported it.

Read More [[link removed]] POLITICO Playbook: October 8, 2019

Tyler Law, Schools and Communities First spokesman, told POLITICO that it’s “huge to have the strong support of so many presidential candidates who recognize Californians’ historic opportunity to reclaim billions for public schools and local communities. … There’s no question that this is the leading initiative on the 2020 ballot.”

There’s still plenty of political challenges ahead for the measure. The growing interest by 2020 Dem pack comes as a recent Public Policy Institute of California poll appeared to show that while 57 percent of adults say they back split-roll reform, the tracking among likely voters is a much closer 47-45 percent for passage. And the Protect Prop. 13 effort, led by the California Business Roundtable and the California Taxpayers’ Association, has ramped up in what business groups vow will be an aggressive campaign to stop the split roll drive.

WHAT TO LOOK FOR: Expect more Democratic presidential hopefuls to come on board. California Democrats will be holding a major convention in mid-November in Long Beach, where a presidential forum is also planned — a big stage for 2020 candidates to take a stand on what will be the most-watched and debated ballot measure in the nation’s most populous state in November 2020. Stay tuned.

Read More [[link removed]] California Vs. US Fuel Price Gap At 50.3% Premium

The September average price per gallon of regular gasoline in California rose 20 cents from August to $3.81. The California premium above the average for the US other than California ($2.53) jumped to $1.27, a 50.3% difference, according to data assembled by the non-profit California Center for Jobs and the Economy.

The primary factor behind the California price rise was production problems at three of the state’s refineries, according to the organization. Compounding this situation was the rise in world oil prices coming from the attacks on the Saudi facilities.

While the rest of the nation was little affected by this supply disruption as a result of access to the expanding domestic production, California instead has moved in the opposite direction. California reliance on foreign crude oil imports rose from 47.7% in 2010 (the year the early actions under AB 32 were implemented) to 57.5% in the latest 2018 data from the Energy Commission.

Read More [[link removed]] Business Climate and Job Creation Fed Will Purchase Treasury Bills At Least Into Second Quarter of 2020

The Federal Reserve will begin buying Treasury bills on Tuesday to boost its balance sheet and avoid a recurrence of the unexpected strains experienced in money markets last month, the central bank said.

The Fed will begin initial purchases of $60 billion in Treasurys over the month beginning next Tuesday. The central bank said it would continue purchases of Treasury bills of unspecified amounts into the second quarter of 2020.

The Fed’s rate-setting committee met by videoconference last Friday, Oct. 4, to discuss recent developments in money markets. It voted unanimously on the plans to purchase Treasury bills to grow its balance sheet.

The central bank said the actions announced Friday were “purely technical measures to support the effective implementation” of the committee’s policy setting “and do not represent a change in the stance of monetary policy.”

Read More [[link removed]] U.S. Inflation Cooled At The End Of The Summer

A key reading on U.S. inflation cooled slightly at the end of the summer.

U.S. consumer prices were flat in September, as a decline in energy and used-vehicle prices held down broader inflationary pressures, after rising a seasonally adjusted 0.1% in August, the Labor Department said Thursday.

Excluding the volatile food and energy categories, so-called core prices rose 0.1%, moderating from a 0.3% increase in August.

In the 12 months through September, overall prices rose 1.7%, while core prices were up 2.4% on the year. Gasoline and used-car prices both posted large declines, though those categories can be volatile.

Inflation readings released by the government this week join other economic reports that point to signs that U.S. growth slowed in September.

Read More [[link removed]] Fed’s Kashkari: If Data Continues As It Has, Another Rate Cut Is Warranted

Minneapolis Fed president Neel Kashkari said Thursday that the time has probably passed for the central bank to use a supersize rate cut to boost the economy, but he remains on board with the idea that cheaper borrowing costs are still warranted.

“My base-case scenario is still growth, I’m not forecasting recession, but the risks to the downside are increasing,” Mr. Kashkari said in an interview with The Wall Street Journal. In this environment, he said, “I think monetary policy is currently around neutral to potentially slightly contractionary.”

“I think don’t think we should be in a contractionary stance,” Mr. Kashkari said. “If the data continues to come in the way it has, I’m going to be supportive of another rate cut. How much more we need to go I don’t know.”

Read More [[link removed]] California Thinks The State Is Going In The Wrong Direction. Here's Why

It just doesn’t jibe. These are pretty good times by historical standards. But most people seem ticked off.

Look back over the last 90 years and compare them with today:

The Great Depression and Dust Bowl wiped out millions of people financially.

World War II killed around 420,000 Americans.

There was a prosperous postwar boom, but also the Korean War.

The ’60s and early ’70s were violent and ugly: civil rights bloodshed, deadly riots, America torn apart by the Vietnam War, the public made more cynical by Watergate.

Then long lines for gasoline, sky-high inflation, 9/11 and terrorist attacks, wars in Iraq and Afghanistan, the Great Recession.

Some of us lived through most of those nightmares.

Today should be considered hog heaven: The economy is purring. The unemployment rate in California is down around 4%, compared to 12%-plus just seven years ago. Hot wars have cooled. We’ve got vaccines now for virtually every virus, unlike 65 years ago. Water reservoirs are full.

Read More [[link removed]] California Governor Says 'Greed' To Blame For Power Outage As More Than 300,000 Remain In The Dark

An angry California Gov. Gavin Newsom slammed the state's largest utility over its power shutoffs, saying they're the result of years of mismanagement and greed.

Pacific Gas & Electric intentionally cut power to almost 800,000 customers in Northern California on Wednesday to prevent wildfires caused by high winds downing live power equipment -- a process the utility had warned they'd be more aggressive about this year. While the company has since restored power for many affected areas, more than 300,000 remain without electricity.

"This is not ... a climate change story as much as a story about greed and mismanagement over the course of decades," Newsom said. "Neglect, a desire to advance not public safety but profits."

Read More [[link removed]] PG&E Leaves 250,000 Homes Still Without Power

Late Thursday, Pacific Gas and Electric (PG&E) reported that it has restored power to more than half of the Northern California households affected by the utility company’s intentional mass blackouts this week. But hundreds of thousands of customers remain in the dark.

“About 426,000 out of a total 738,000 customers have been restored, including full restoration in Humboldt, Siskiyou and Trinity counties. About 312,000 customers remain without power,” according to a PG&E statement issued Thursday night.

[Update: A PG&E spokesperson tells Curbed SF that the count is down to about 250,000 by Friday morning. Note that this refers to the number of meters being serviced at homes and businesses, so 250,000 outages could easily mean half a million or more individuals, although nobody knows the precise count.]

Read More [[link removed]] Blackouts May Cost State $2.6 Billion, I-Team Investigates

The estimates are coming in about how much this week's PG&E blackouts will cost our economy; perhaps billions of dollars.

PG&E has an image problem. They wanted to pay top executives $11 million in incentives this year even though they're bankrupt; a federal judge denied that. Now, these blackouts are costing all of us.

State Senator Jerry Hill sent a letter overnight to the California Public Utilities Commission calling for better oversight of PG&E with these forced blackouts and asking, "Why is PG&E alone in making this decision?"

"They don't have a track record that we can trust or a track record that has shown that they have provided a safe utility," Hill said. "And that they can guarantee what they're doing is the best course of action."

Read More [[link removed]] For the Most Vulnerable, California Blackouts ‘Can Be Life or Death’

When Ben Faus went to bed at his home in the foothills above the Monterey Bay, he knew there was a chance his power would go out but he didn’t know exactly when. About 3 a.m. on Thursday he was jolted awake because his sleep apnea breathing machine stopped working.

“All of a sudden, I was like, ‘I can’t breathe,’” he said.

The decision to turn electricity off for large areas of Northern California inconvenienced and frustrated hundreds of thousands of residents, but it became increasingly dangerous for people like Mr. Faus and the state’s most vulnerable.

Around 600,000 customers were still without power on Thursday afternoon and there was no clear indication of when it might be restored. That uncertainty heightened residents’ anger as food spoiled and businesses and schools stayed closed.

Read More [[link removed]] More Than Half Of Latinos In California Struggle To Stay Afloat, Report Finds

For three years, Kimberly Esquivel and her family lived in a studio apartment in Oakland, with Kimberly and her sister sleeping in the main room and her parents and two brothers in the hallway.

Esquivel's father is legally blind and has a kidney condition that prevents him from working. Her mother sells jewelry, but it hasn't provided enough money to improve their living situation. They can’t afford a car and food adds up. Kimberly, 18, and her 20-year-old sister want to go to college, but they can't do it until the family's finances become more secure.

The Esquivels' precarious situation is not unique. In California, more than 50% of Latino households are hard-pressed to make it financially, despite the state’s booming economy and strong labor market, according to a new report from Oakland’s Insight Center for Community Development.

The study, released Thursday, found broad swaths of the state’s largest ethnic group living in economic insecurity and earning significantly less than Californians overall, even as many work multiple jobs to try to make ends meet.

Read More [[link removed]] $15 Billion California School Bond Headed For March Ballot With Newsom's Signature

Saying he hoped voters will “get this thing passed by historic numbers,” Gov. Gavin Newsom signed legislation Monday that will place a $15 billion construction bond covering pre-K through higher education facilities on the March 2020 state ballot.

“The goal is self-evident. You improve the conditions, you ultimately improve the quality of the educational experience,” Newsom said in a signing ceremony at Ethel I. Baker Elementary, a low-income school in Sacramento. “Success in education is synergistic with the environment.”

The bond — the largest state school bond to date in California ­— will include $6 billion for higher education, split evenly among community colleges, California State University and the University of California. An additional $9 billion will go to K-12 schools. For the first time, districts will be eligible for matching dollars for preschool facilities they build or renovate. Districts whose facilities have lead in drinking water, have other pressing health and safety issues or need seismic repairs will get priority for the money, he said.

Read More [[link removed]] Energy and Climate Change California Will Meet Its 2030 Emissions Goals--In 2061

Echoing a report late last year from the state’s California Air Resources Board, a newly-released report that shows the state will not meet its 2030 emissions goals until 2061 and will not meet its 2050 goals until 2157, a 31-year and a 107-year delay.

The 2019 California Green Innovation Index, research from nonprofit and nonpartisan organization Next 10, presents a dire picture that vilifies the individual car.

“The transportation sector alone represents 41% of California’s statewide emissions—a percentage that has been increasing the last few years,” said F. Noel Perry, founder of Next 10. “Vehicle ownership has hit an all-time high and even in climate-conscious California, consumer preferences for SUVs and larger vehicles are adding to the challenges.”

Read More [[link removed]] Don't Leave Low-Income Families Behind In California's Climate Fight

Nearly 40% of Californians qualify as low-income. These residents are the most likely to suffer from harmful air quality and the disproportionate impacts of climate change. Yet they are unfortunately also the most likely to miss out on the benefits California's programs and dollars aimed at addressing climate change and air pollution.

Critically, this includes the state's efforts to boost energy-saving retrofits of low-income buildings, such as through efficient lighting, improved insulation of walls, and new heating and air conditioning systems.

State lawmakers, energy regulators, local governments and industry leaders must not leave California's nearly 15 million low-income residents behind as the state pursues its climate and energy goals, which include doubling the rate of energy efficiency savings in buildings, reducing greenhouse gas emissions 40% below 1990 levels by 2030 and achieving statewide carbon neutrality by 2045.

Read More [[link removed]] Study: Despite Gains, California Is Lagging On Climate Goals

Although California met its 2020 emissions reductions set by Senate Bill 32 four years early, the state is not on track to meet 2030 and 2050 goals—not even close—if the average rate of emissions reductions holds steady. That’s one of the findings of the 11th annual California Green Innovation Index, released Tuesday.

This year’s report, released by the nonpartisan nonprofit Next 10 and prepared by Beacon Economics, highlights how successful emissions reductions in the power sector have been overshadowed by growing challenges from harder-to-control areas—such as transportation and wildfires. If greenhouse gas (GHG) emissions are not reversed more quickly, the authors conclude, California will meet its 2030 climate goals three decades late, in 2061. And the state could be more than a century late in hitting the 2050 target without major policy and technology breakthroughs to dramatically accelerate the decline in emissions.

On the positive side, the report shows that, since 2000, electricity production has seen continuous improvements in reducing emissions. And it found that 2017 was the first time a greater portion of the state’s energy mix came from renewables, such as wind and solar, than it did from fossil fuels. But the authors note that while California has the second-lowest rate of carbon emissions per capita in the nation, and a carbon intensity 54 percent lower than the rest of the U.S., there are serious challenges ahead, especially in the residential and transportation sectors, which have seen only small declines in GHG. And California’s large commercial sector is moving in the wrong direction, with emissions increasing more than 64 percent.

Read More [[link removed]] A Carbon Tax Is 'Single Most Powerful' Way To Combat Climate Change, IMF Says

Increasing the price of carbon is the most efficient and powerful method of combating global warming and reducing air pollution, according to a new report from the International Monetary Fund.

While the idea of carbon taxes on fossil fuel corporations has been spreading across the globe in the past couple decades, increasing prices on carbon emissions has received widespread backlash from those who argue the tax would raise energy bills.

But economists have long contended that raising the cost of burning fossil fuels like coal, oil and gas is the best way to mitigate climate change, and that revenue raised from the tax can be returned to consumers through rebates and dividends.

“We view fiscal policy as a crucial way of combating climate change,” said Paolo Mauro, deputy director of Fiscal Affairs Department at the IMF. “You can reshape the tax system and you can reshape fiscal policy more generally in order to discourage carbon emissions.”

Read More [[link removed]] What If We've Had Carbon Taxes Backwards All Along?

The best way to use a carbon tax to fight climate change would be to set the initial carbon price high, increase it modestly for about a decade, and then let it fall slowly over the next few centuries, researchers reported last week in the Proceedings of the National Academy of Sciences.

That’s opposite to the conclusions of conventional climate-economy models, which generally suggest that carbon taxes should start fairly low and increase gradually over time.

The reason for the difference is that the new model, dubbed EZ-Climate, incorporates the costs of uncertainty and the value of avoiding climate risks.

Conventional climate-economy models used for the last quarter-century don’t represent risk and uncertainty very well. People have known these concepts are important, but have struggled to incorporate them into models because it is so complicated and often requires outsized computing power to do so.

Read More [[link removed]] California's Huge, Humiliating Power Outages Expose The Vulnerabilities Of PG&E's Power Grid

California has always prided itself on being a high-tech pioneer. One exception? Power distribution.

With Pacific Gas & Electric Co. expected to cut electricity to 800,000 customers this week, the state is confronting its reliance on a transmission network that predates climate change, solar panels and lithium-ion batteries, depending instead on electric lines strung over thousands of miles on vulnerable wooden poles.

Until that changes, experts say, utility executives are sure to cut electrical service to large sections of the state during high winds, rather than risk downed lines and transformers like those that have sparked deadly wildfires over the last two years.

Utility operators historically built power grids — with massive electrical plants fired by fossil fuels and transmission lines that stretched for hundreds of miles — to provide the cheapest possible electricity. They weren’t concerned about air pollution and global warming, or the more immediate threat from wildfires, said Michael Wara, director of Stanford University’s climate and energy policy program.

Read More [[link removed]] Workforce Development What Will It Take To Make Headway On Student Achievement?

In the annual fall ritual that accompanies changing of the leaves, student test scores are out again. In California, state tests show students making slow and steady progress toward mastering learning standards: there was a 1 percentage point increase since last year in the proportion of students meeting or exceeding the standards in both English language arts (ELA) and math. Now 51 percent of students are meeting or exceeding the standards in ELA and 40 percent are doing so in math.

Student scores have incrementally increased every year that California has administered the online Smarter Balanced Assessments — called the CAASPP tests. In both areas the share of students meeting California’s more rigorous learning standards has increased by about 7 percentage points since 2015.

These standards focus much more explicitly on higher-order thinking and performance skills than the state’s earlier tests.

Read More [[link removed]] For California Schools, 2002 Could Prove Historic

California public schools will be getting a big infusion of cash — a very, very big infusion — if voters approve an unprecedented trifecta of multibillion-dollar measures aimed at next year’s statewide ballots.

First, there’s a $15 billion plan, financed by bond borrowing, for construction projects for K-12 and higher education. Gov. Newsom signed the bill and placed it on the March ballot.

Second, the California School Boards Association is pushing its “Full and Fair Funding Measure,” which would generate $15 billion annually for public schools. The measure would increase taxes on corporate income over $1 million by up to 5 percent, and increase personal income tax on annual earnings over $1 million by 2 percent and over $2 million by 3 percent. The initiative, which has not yet qualified, is targeting the November 2020 ballot. There is speculation in the Capitol that this measure may become the subject of legislation next year, allowing the Legislature and governor to place it on the ballot.

Read More [[link removed]] California Needs A Master Plan For Early Childhood

Advocates, leaders and researchers have been waiting for a long time to have an early childhood champion in the governor’s office.

Now we finally have one. Gov. Gavin Newsom and the new California Legislature have a historic opportunity to put families first this year — something politicians all say they want to do.

Gov. Newsom committed a $2.5 billion-dollar total investment in early childhood in the 2019-20 budget, focused on the whole child, and composed of new one-time funds and ongoing funding. That is something we should all be praising.

The big question is: What should we do next and how? There are too many working families on waiting lists for childcare, early learning providers don’t receive enough public funds to provide the best care for our families and teachers are paid poverty-level wages. Too many children are not getting the health services they need to give them the best start in life.

Read More [[link removed]] Infrastructure and Housing How Lawmakers Are Upending The California Lifestyle To Fight Housing Shortage

When California lawmakers tried earlier this year to force local governments to allow four or more homes on land zoned for single-family residences, fierce pushback from suburban communities stopped the plan in its tracks. For many, the long-standing neighborhood template of a home, backyard and garage on a lot was too intrinsic to the California lifestyle to upend.

But over the past four years, a suite of smaller proposals has quietly chipped away at zoning only for single-family homes, attracting comparably little blowback.

Lawmakers have made it easier for homeowners to convert garages into residential space and build small freestanding homes, sometimes known as granny flats or casitas, in their backyards. And on Wednesday, Gov. Gavin Newsom signed multiple bills into law that aim to spur construction, including legislation that will allow property owners to build a backyard home of at least 800-square-feet as well as convert a garage, office or spare room into a third living space.

Read More [[link removed]] How Cities Address The Housing Crisis, And Why It’s Not Enough

It’s a simple idea: Everyone should have a place to live. But we are failing badly at this most basic of goals, in every part of the country.

In Brooklyn and Minneapolis, where we are city council members, skyrocketing prices push families out of the neighborhoods where they’ve lived for years. It’s impossible for young people to find a place to rent, much less own. Homelessness is at record levels, and in cities like Detroit, as many as one in five renters face eviction, part of a nationwide eviction epidemic.

As members of Local Progress, a national network of progressive elected officials from cities and other local governments across the country, on Thursday we began a three-day convening in Durham, North Carolina, to address these issues that are infiltrating more and more cities.

Read More [[link removed]] Editorial and Opinion Democrats Plan In California Is Not Working

It should be headline news, but it's not, and that's because the media is in lock-step with the Democrats, who have run California for a generation. "Progressive" failures are rarely acknowledged.

Just imagine you're living in California, not among the coastal elites. No, you're one of the 7 million poor people in the "Golden State," [and] a 15-gallon fill-up for you costs $62. The rest of the country pays about $20 less per fill-up, and it's $30 less in states like South Carolina.

In California, the very high cost of just getting around really hurts the poor, even though the Democrats are supposed to be helping the poor.

Now, look at the other end of the scale: The rich.

They face the highest income tax rates anywhere. The top rate is 13 percent on top of federal taxes. And of course, under the new tax law, those state-tax payments are no longer deductible. No wonder the rich are leaving.

But it begs the question: How come the state with the highest taxes has the highest poverty rate? The Democrats running for president tell us that if we raise taxes even more, we would reduce income inequality. Hasn't worked in California.

Read More [[link removed]] California's Dark Ages

Californians are learning to live like the Amish after investor-owned utility PG&E this week shut off power to two million or so residents to prevent wildfires amid heavy, dry winds. Blame the state’s largest blackout on a perfect storm of bad policies.

Two dozen or so wildfires in the past few years have been linked to PG&E equipment, including one last fall that killed 85 people. PG&E under state law is on the hook for tens of billions of dollars in damages and has filed for bankruptcy. For years the utility skimped on safety upgrades and repairs while pumping billions into green energy and electric-car subsidies to please its overlords in Sacramento. Credit Suisse has estimated that long-term contracts with renewable developers cost the utility $2.2 billion annually more than current market power rates.

PG&E customers pay among the highest rates in America. But the utility says inspecting all of its 100,000 or so miles of power lines and clearing dangerous trees would require rates to increase by more than 400%. California’s litigation-friendly environment has also increased insurance rates for tree trimmers and made it hard to find workers.

Read More [[link removed]] The California Dream Is Over. What Comes Next?

For two days, confusion has reigned in California. Ironically, in an area known for technological innovation, our basic infrastructure is bowing to the forces of nature, and information about the power cutoffs that Pacific Gas & Electric has ordered to minimize the threat of wildfire has been hard to find.

More than a “massive inconvenience,” as Gov. Gavin Newsom (D) called the shutdown, this unprecedented measure marks a new low in public confidence that could have far-reaching consequences on California and its residents. It’s fueling anger, distrust and bitterness from Californians already struggling to meet basic needs in the midst of an affordable housing crisis, staggering gas prices and increasing precarity in gig economy jobs that offer barely a living wage. We are supposed to be the state that represents America’s bright future. But what happens when that future goes dark?

Like many Californians, I am suspended between two parallel worlds: that of my overflowing email inbox where life and work mostly proceed as usual at the university where I work in San Francisco, where power would remain on, and the other in which potential chaos waits around the corner.

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]