Dan Walters • CalMatters Columnist, Author at Times of San Diego https://timesofsandiego.com Local News and Opinion for San Diego Tue, 28 May 2024 17:54:10 +0000 en-US hourly 1 https://timesofsandiego.com/wp-content/uploads/2021/01/cropped-TOSD-Favicon-512x512-1-100x100.png Dan Walters • CalMatters Columnist, Author at Times of San Diego https://timesofsandiego.com 32 32 181130289 Opinion: California’s Goal to Be Carbon-Neutral by 2045 Could Slow Growth of Logistics Industry https://timesofsandiego.com/opinion/2024/05/28/californias-goal-to-be-carbon-neutral-by-2045-could-slow-growth-of-logistics-industry/ Tue, 28 May 2024 17:54:02 +0000 https://timesofsandiego.com/?p=274067 Tesla electric semi-truckOne of the biggest unknowns about a carbon-neutral future is the impact on economic sectors that depend on transportation, especially Southern California’s logistics industry.]]> Tesla electric semi-truck
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A prototype Tesla electric semi-truck at a charging station. Image from Tesla video

California’s governor, Gavin Newsom, flew more 6,000 miles to Rome this month to deliver a brief speech on climate change at a Vatican-sponsored conference.

Media reports of Newsom’s appearance centered on his verbal potshot at former President Donald Trump and his conversation with Pope Francis who, Newsom said, praised his unilateral suspension of executions in California.

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However, the governor did devote a little time to climate change, mostly reiterating his villainization of the oil industry.

“It’s because of the burning of gas, the burning of coal, the burning of oil,” Newsom said. “We have the tools. We have the technology. We have the capacity to address the issue at a global scale and they’ve been fighting every single advancement and we have got to call that out.”

At this point, we should remind ourselves that Newsom’s constant gallivanting to polish his image as a political heavyweight depends on planes and automobiles that burn petroleum. Nevertheless, he has proclaimed that California will by 2045, just 21 years hence, become carbon emission-neutral.

In 2022, the state Air Resources Board issued a “scoping plan” with multiple precise steps to achieve the goal. Newsom hailed it as “a comprehensive roadmap to achieve a pollution-free future” and, with characteristic hyperbole, “the most ambitious set of climate goals of any jurisdiction in the world … (that could) spur an economic transformation akin to the industrial revolution.”

That’s a lot to be done in just a couple of decades, and there’s not been a particularly noticeable amount of progress. In fact, there’s been some regression.

It’s questionable whether California will have enough power from solar panels and windmills not only to fill current demand but supply additional juice for the many millions of battery-powered cars and trucks that the plan envisions.

Fearing blackouts, Newsom pressed to keep some natural gas-fired power plants and the state’s only nuclear-powered plant operating past their planned phaseout dates. Electric car sales have languished, even though automakers are supposed to quit selling gasoline- and diesel-powered vehicles in just 11 years. Car buyers are leery because the state still has only a fraction of the recharging stations conversion requires.

Furthermore, to deal with a budget crisis, Newsom has slashed spending on climate change programs.

One of the biggest unknowns about a carbon-neutral future, however, is the impact on economic sectors that depend on transportation. A new report on one of those sectors, Southern California’s logistics industry, frames the issue.

A half-century ago, Southern California’s leaders bet the region’s future on the twin ports of Los Angeles and Long Beach becoming the nation’s primary conduit for trade with Asia, and the transportation and warehousing facilities to handle cargo.

The new report from the California Center for Jobs and the Economy, an offshoot of the California Business Roundtable, reveals how impressively that goal has been achieved.

What it terms the “regional trade cluster” is the region’s largest single source of employment, supporting 1.85 million jobs, two-thirds of which require only a high school education or less — an important characteristic given its huge immigrant population.

However, global transportation is a cutthroat business and the twin ports have seen their traffic decline in recent years due to competition from ports with lower operational costs. The sector is also being pressed by state and local authorities to convert ships, trucks, locomotives and other machinery to low- or no-emission propulsion, at huge cost. There has been a backlash against the massive warehouse complexes in inland areas.

Can the industry undergo the massive conversion Newsom’s plan envisions in just 21 years — without becoming terminally uncompetitive and shedding the jobs on which so many of the region’s families depend?

It’s a microcosm of the larger uncertainty.

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: Decades-Long Delta Tunnel Water Project May Finally Be Nearing a Historic Decision https://timesofsandiego.com/opinion/2024/05/24/decades-long-delta-tunnel-water-project-may-finally-be-nearing-a-historic-decision/ Sat, 25 May 2024 05:05:08 +0000 https://timesofsandiego.com/?p=273758 California aqueduct fills with storm waterThe tunnel’s $20 billion cost is already many billions of dollars over earlier estimates. As costs climb, the willingness of downstream water agencies to cover construction bonds is still uncertain, and environmental groups are still opposed.]]> California aqueduct fills with storm water
California aqueduct fills with storm water
A drone provides a view of water pumped into into the California Aqueduct. Courtesy DWR

It’s been almost a half-century since I first heard the term “peripheral canal” uttered by William Gianelli, who was then-Gov. Ronald Reagan’s top water official. The project, in one form or another, had already been kicking around for decades.

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The California Water Project became operative in the 1960s and was the most prominent legacy project of Pat Brown, whom Reagan had defeated in 1966.

The project dams the Feather River near Oroville and releases impounded water to flow down the Feather into the Sacramento River and eventually into the Sacramento-San Joaquin Delta. Pumps at the southern edge of the Delta suck the water into the California Aqueduct, which carries it down the San Joaquin Valley to more pumps over the Tehachapi Mountains into Southern California.

Pumping water out of the Delta changes the massive estuary’s natural flows and, as widely recognized, damages habitat for fish and other wildlife. The envisioned 44-mile-long peripheral canal would have carried water around the Delta to the head of the aqueduct thereby, it was said, improving water supply reliance and protecting fish.

However, there was widespread opposition, mostly from environmentalists who doubted the canal would have a beneficial impact. The project stalled until Pat Brown’s son, Jerry, became governor in 1975 and attempted to complete the last remaining link in his father’s landmark water plan.

Brown relentlessly pressed the Legislature to authorize the canal and finally succeeded, but the compromise version failed to mollify environmentalists and alienated San Joaquin Valley farmers. The two disparate groups formed an odd-bedfellows alliance that defeated the project in a 1982 referendum, the same year Brown’s bid for a U.S. Senate seat failed.

Voter rejection put the project in political limbo for two-plus decades, until Arnold Schwarzeneger became governor and proposed twin tunnels, instead of a canal, to bypass the Delta. Jerry Brown returned to the governorship in 2011 and once again sought to get it done.

It was still just an idea when Gavin Newsom succeeded Brown in 2019. Almost immediately he downgraded it to one tunnel and ordered the Department of Water Resources to get it going. The much-revised project barely survived a 2016 ballot measure that probably would have killed it, and with Newsom’s governorship down to its last couple of years, it is nearing the decisive moment.

The project has undergone several name changes over the decades but is now dubbed the Delta Conveyance Project. Recently, the water agency released an updated report on the tunnel, raising its cost to $20 billion but insisting that it still pencils out in a cost-benefit analysis.

“For every $1 spent, $2.20 in benefits would be generated,” Department of Water Resources officials declared. “The report also shows the very real cost of doing nothing, posing significant future challenges to supplying water to California communities.”

Cost-benefit claims of big public works projects are notoriously subjective because they rely on notoriously unreliable cost estimates and equally squishy definitions of benefits.

The tunnel’s $20 billion cost is already many billions of dollars over earlier estimates. As costs climb, the willingness of downstream water agencies to cover construction bonds is still uncertain, and environmental groups are still as opposed as they were in 1982.

By its nature, a bypass tunnel would reduce water flows through the Delta. As Newsom’s administration tries to clear financial and environmental issues, it is also trying to get San Joaquin Valley farmers to take less water from its rivers so that more can flow through the Delta.

The interplay between those two somewhat contradictory efforts is one of the project’s most intriguing aspects. 

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: California’s Lagging Economy Hinders Efforts to Close State Budget Deficit https://timesofsandiego.com/opinion/2024/05/20/californias-lagging-economy-hinders-efforts-to-close-state-budget-deficit/ Tue, 21 May 2024 05:05:58 +0000 https://timesofsandiego.com/?p=273322 construction siteCalifornia’s recovery from the devastating economic impacts of the COVID-19 pandemic has been sluggish at best, trailing what’s happening in the nation as a whole and in the state’s archrivals, such as Texas and Florida.]]> construction site
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Workers pour cement at a construction site for an office tower in downtown San Diego. REUTERS/Mike Blake/File Photo

As Gov. Gavin Newsom and state legislators spend the next few weeks fashioning a state budget that’s plagued by a multibillion-dollar deficit, they can’t count on a booming economy to make their task easier.

California’s recovery from the devastating economic impacts of the COVID-19 pandemic has been sluggish at best, trailing what’s happening in the nation as a whole and in the state’s archrivals, such as Texas and Florida.

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According to Employment Development Department data, there are 200,000 fewer Californians in the labor force — those employed or seeking employment — than there were in February 2020, just before the pandemic exploded. There are 500,000 fewer employed, and 200,000 more unemployed.

While California’s unemployment rate of 5.3% in March was just a third of what it was at the height of the pandemic-induced recession, it was still the highest of any state, markedly higher than the national rate of 3.9% and nearly two percentage points higher than it was before the pandemic.

By the federal government’s more nuanced measure of employment called U-6, which counts not only the unemployed, but workers who are “marginally attached” to the labor force and those who are involuntarily working part time, the state’s 9.5% rate of underemployment is also the nation’s highest.

Those numbers imply an economy that’s not even operating at cruising speed, much less accelerating. Even the state’s technology sector, centered in the San Francisco Bay Area, has cooled off as its once high-flying corporations announce layoffs virtually every day.

“California’s civilian employment growth has been essentially flat since the second half of 2022 while the U.S. has remained relatively healthy, resulting in the state’s unemployment rate rising faster than the nation,” the revised budget Newsom unveiled last week acknowledges.

The pandemic erased about 3 million jobs in California as Newsom shut down large segments of the state’s economy. Countless employers, particularly small businesses, never reopened after the health crisis eased and those that did survive have had to contend with inflationary costs, tighter loan conditions and changed consumer habits.

The budget blames stubborn inflation and the high interest rates imposed by the Federal Reserve System to tame inflation for California’s slowdown, but economies of other states have experienced the same factors and prospered despite them.

However, they don’t contend with factors unique to California, such as extremely high costs for housing, utilities and labor that make job creation more difficult here. Until recently, California has been losing population, thanks to outward migration to other states. The state has also seen employment shifts, particularly in technology.

Those conditions underscore the sluggish recovery that sets California apart from other states. For instance, Texas’ unemployment rate, 3.9%, is identical to the national rate while Florida’s 3.2% is even lower.

So, one might ask, where is California’s once-booming economy headed?

Newsom’s Department of Finance says it “has not modeled a recession scenario. However, if inflation takes longer to cool and interest rates remain high for longer than projected in the May Revision baseline forecast, continued tight credit conditions could further discourage economic activity.”

A few days before he released his revised budget, Newsom stood at the top of a Golden Gate Bridge tower to record a video celebrating the tourism industry’s recovery.

Visitors to California spent $150.4 billion last year, he said, surpassing the previous record of $144.9 billion in 2019.

That’s good news, even though an adjustment for inflation would probably reduce the recovery’s relative impact. But while it’s a high-profile economic sector, tourism is scarcely 3% of the state’s overall economy. It’s the other 97% we should be nurturing.

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: Newsom Finally Accepts Gloomy Budget Deficit, Cites ‘Massive Volatility’ in Tax Collections https://timesofsandiego.com/opinion/2024/05/14/newsom-finally-accepts-gloomy-budget-deficit-cites-massive-volatility-in-tax-collections/ Wed, 15 May 2024 05:05:00 +0000 https://timesofsandiego.com/?p=272524 Gov. Gavin NewsomCalifornia Gov. Gavin Newsom unveiled a revised state budget last week that increases the projected deficit by billions of dollars and contained real cuts, something his initial version mostly lacked.]]> Gov. Gavin Newsom
Gov. Gavin Newsom
Gov. Gavin Newsom presents his budget plan in Sacramento in January. Courtesy of the governor’s office

When Gov. Gavin Newsom proposed a 2024-25 state budget in January, he declared that the state faced a $38 billion deficit and chided journalists for citing wider projections in the gap between income and outgo from the Legislature’s budget analyst.

Nevertheless, state legislative analyst Gabe Petek stuck by his guns and a month later increased his deficit estimate during a three-year “budget window” to $73 billion, citing a $24 billion shortfall in revenue estimates over the period.

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On Friday, Newsom unveiled his revised budget, covering the current fiscal year, the 2024-25 year and 2025-26, and tabbed the deficit at $44.9 billion through 2024-25. He estimated an additional $28.4 billion in 2025-26, totaling $73.3 billion.

Newsom, indirectly agreeing with Petek’s gloomy revenue picture, blamed “massive volatility” in the state’s revenue system, particularly difficulty in projecting income taxes on capital gains, for the wide fluctuations in revenue estimates and reality. Over four years, he noted, revenues have fallen $165 billion short of estimates.

It’s not a new phenomenon. Over several decades, the state has become overwhelmingly dependent on personal income taxes to finance its budget, particularly taxes on high-income taxpayers and their investment earnings.

As that dependency increased, the state would experience massive windfalls during some years and deep revenue declines in others. When the state treasury was flush, governors and legislators would increase spending, and when revenues declined, they would face multibillion-dollar deficits.

The peaks have increased. Just two years ago, Newsom boasted of a $97.5 billion budget surplus. “No other state in American history has ever experienced a surplus as large as this,” he said as he unveiled a $300-plus billion budget that the Legislature eagerly adopted with a few tweaks.

Likewise, the valleys have deepened, with this year’s massive deficit a prime example — and the revenue cycles bear only passing relationship to the overall economy.

Newsom, like his predecessors, says that volatility could be tamed were the state to overhaul its revenue system and reduce its dependence on taxing the rich. But he, like the others, is obviously unwilling to do the heavy lifting that a tax reform would require.

Gov. Arnold Schwarzenegger and the Legislature appointed a blue-ribbon commission to study revenue volatility and recommend systemic changes. The commission was sharply divided but issued a report proposing fundamental changes, but it was quickly filed away and ignored.

Having acknowledged the much larger deficit, Newsom proposes two changes in the budgetary process to cope with the volatility factor: including future budgets in the annual calculations and not spending erratic revenue sources, such as capital gains, until they are realized.

Newsom said that were the Legislature to adopt his revised budget and the current revenue estimates proved accurate, the state could get its budget balanced by 2026 — which would coincide with the last year of his governorship.

The budget closes the gap with a melange of spending cuts, deferrals, tapping into emergency reserves, some increased taxes and some accounting gimmicks. Over two years, the state would use about $13 billion in emergency reserves, plus another $8 billion for schools from a separate reserve.

The initial version made few true spending reductions. But with a wider deficit, the revised budget contains some real cuts, including the partial closure of some prisons, and shrinkage in some of the appropriations made when it appeared the state had a big surplus.

“I prefer not to make these cuts,” Newsom told reporters, adding, “You’ve got to do it.”

Whether the Legislature can resist pressure from advocates for the programs Newsom would cut remains to be seen.

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: California Supreme Court Takes Up ‘Mother-of-All Taxation Battles’ https://timesofsandiego.com/opinion/2024/05/09/california-supreme-court-takes-up-mother-of-all-taxation-battles/ Fri, 10 May 2024 05:05:51 +0000 https://timesofsandiego.com/?p=272303 California Supreme Court BuildingThe California Supreme Court will decide in the coming weeks whether to kick a measure off the November ballot that would make it more difficult to raise taxes. The case pits Democratic leaders and unions against business and taxpayer groups.]]> California Supreme Court Building
California Supreme Court Building
The California Supreme Court’s headquarters in San Francisco at the Earl Warren Building and Courthouse. Photo credit: Wiki Commons

When California’s voters 46 years ago passed Proposition 13, its iconic property tax limit, they ignited a perpetual conflict over how much tax money state and local governments need and who should supply it.

Since 1978, public employee unions and other beneficiaries of government spending have repeatedly tried to repeal Prop. 13’s barriers and make it easier to enact new taxes.

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At the same time, business interests and anti-tax groups such as the Howard Jarvis Taxpayers Association, named for Prop. 13’s chief sponsor, have backed additional ballot measures to make new taxes more difficult.

As the conflict raged, pro-tax interests became dominant in the Capitol and in local governments, but the anti-tax faction mostly prevailed in post-Prop. 13 ballot battles. In 2020, for example, voters rejected a union-sponsored ballot measure that would have changed Prop. 13 to allow higher taxes on commercial real estate.

Concurrently, California courts have eroded some of the taxation barriers the anti-tax forces erected. In 2020, the state Supreme Court made raising local taxes easier by declaring that tax measures proposed by initiative needed only simple majority voter approval, rather than two-thirds.

The nearly half-century of skirmishing over taxation is reaching a climax of sorts this year in the form of a ballot measure, backed by the California Business Roundtable, that would require voter approval of new state taxes, increase the threshold of voter approval for taxes to two-thirds, and reclassify many fees as taxes needing voter approval.

It shapes up as the mother-of-all taxation battles with deep-pocketed interests on both sides — but only if it actually appears on the ballot.

Gov. Gavin Newsom, the Legislature’s Democratic leaders and local government officials want the state Supreme Court to declare that the measure is not a constitutional amendment, as its sponsors claim, but rather is so sweeping that it constitutes a constitutional revision that cannot be placed before voters via initiative petition.

On Wednesday, lawyers made their arguments to the court’s seven justices, who must decide whether the measure can appear on the ballot by June 27, the deadline for preparing ballots and other material for the November election.

Margaret Prinzing, an Oakland attorney representing Newsom and other opponents, argued that the measure would strip the Legislature of its constitutional power to raise taxes and the governor of authority to enact fees, thus making fundamental changes in California’s system of government that qualify it as a constitutional revision.

Thomas Hiltachk, a Sacramento attorney who specializes in ballot measures with a conservative bent, countered that the Constitution recognizes voters as the ultimate political authority and the proposed measure merely underscores that primacy. He told the court that it could review its constitutionality after the election if it passes, rather than short-circuit the process by knocking it off the ballot.

The justices questioned both attorneys sharply on the dividing line between a constitutional amendment and a revision, but gave little indication of how they are likely to rule. They probably lean against the measure personally, given the court’s dominance by appointees of Democratic governors, but in past cases have tended to uphold the initiative process.

Allowing the measure to proceed would merely shift the battle to the electoral arena but that has its own complications. The Legislature has also placed a constitutional amendment on the ballot that would, if it gets more votes than the anti-tax measure, raise the threshold for passage of the latter to two-thirds — the same margin proposed for taxes.

That would probably ignite a post-election clash in the courts, thus extending California’s version of medieval Europe’s Hundred Years War.

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: California’s Population Is Growing Again. Is That a Good Thing? https://timesofsandiego.com/opinion/2024/05/05/opinion-californias-population-is-growing-again-is-that-a-good-thing/ Mon, 06 May 2024 05:05:58 +0000 https://timesofsandiego.com/?p=271943 Thousands of people crowd the Midway at the Del Mar Fairgrounds at KAABOO.California has long experienced economic and population booms and busts. After several years of population decline, the state is beginning to grow again. Is that a good trend or a negative one?]]> Thousands of people crowd the Midway at the Del Mar Fairgrounds at KAABOO.
Thousands of people crowd the Midway at the Del Mar Fairgrounds at KAABOO.
Thousands of people crowd the Midway at the Del Mar Fairgrounds. Photo by Chris Stone

After Jerry Brown became governor of California for the first time nearly a half-century ago, he declared that the state had entered “an era of limits.”

Citing “sluggish economic growth, increasing social instability, widespread unemployment and unprecedented environmental challenges,” Brown told state legislators in his 1976 state of the state speech, “In place of a manifest economic destiny, we face a sober reassessment of new economic realities, and we all have to get used to it.”

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At the time, his rather gloomy observation seemed to be in line with current events. California had seen startling population growth and economic expansion in the decades after World War II, becoming the most populous state in 1962 during the governorship of Brown’s father, Pat Brown.

However, population growth slowed in the 1970s after the postwar baby boom had waned. By then the state’s economy was undergoing a dramatic, dislocating transformation from industrialism to post-industrial domination by trade, services and technology.

As it turned out, however, the conditions Brown cited, which he translated into fiscal austerity for state government, were merely a pause, not a permanent new reality.

California boomed in the 1980s, with Ronald Reagan’s administration pumping many billions of dollars into the state’s aerospace sector for a military buildup and a population surge driven by waves of migration, mostly from Latin America and Asia, and a new baby boom.

Between 1980 and 1990, California’s population increased by more than 6 million people to nearly 30 million. The 26% gain meant California gained a whopping seven new congressional seats after the 1990 census.

However, things began to slow down shortly thereafter. In the 1990s, the end of the Cold War with the Soviet Union manifested itself in sharp cutbacks in military spending, leading to a recession and an exodus of aerospace workers and their families.

Population grew slowly over the next two decades and declined during the COVID-19 pandemic as stay-at-home workers fled to states with less expensive housing, foreign immigration slowed, the death rate rose and the birth rate declined.

However, a new report from the state Department of Finance’s demographics unit says that after four years of population lossCalifornia gained a tiny bit in 2023, “driven by decreased mortality and a rebound in legal foreign immigration.”

The gain was 67,000 residents, bringing California’s population to 39,128,162, the department’s demographers found as they calculated the various factors that influence population changes. What they call “natural growth” — births minus deaths — increased from 106,700 in 2022 to 118,400 in 2023, largely because the death rate dropped after spiking upward during the pandemic.

California’s 1980s baby boom is just a faint memory, however. At one point Californians were producing more than 600,000 babies each year, the equivalent of more than one birth every minute, but the state’s birthrate has dropped to a record low and it now has one of the nation’s lowest fertility rates, according to a new study released this week.

The Birth Industry Lawyers Group, which specializes in maternity legal issues, used federal data to report that California’s fertility rate over the past several years, 55 per 1,000 women, is below the national rate of 58.8 and ninth lowest among the states. South Dakota is the most fecund state with a 71.2 fertility rate, followed closely by North Dakota.

The new Department of Finance report projects that with the effects of pandemic worn off, California’s population will continue to grow, albeit slowly.

The new data raise an old question: Is California better off with an increasing population or do the demands of more people just make things more complicated by increasing competition for jobs, housing and other necessities of life?

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: California’s Affluent Bedroom Cities Continue to Fight New Housing https://timesofsandiego.com/opinion/2024/05/01/californias-affluent-bedroom-cities-continue-to-fight-new-housing/ Thu, 02 May 2024 05:05:00 +0000 https://timesofsandiego.com/?p=271313 Del MarCalifornia’s perpetual political war over housing, pitting the state against local communities, has two new battlegrounds: one on the San Francisco Peninsula, the other in Southern California.]]> Del Mar
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Del Mar is one of the cities that sued to stop Senate Bill 9, which allows single-family lots to be subdivided. Photo by Chris Stone

At least once a month a new front opens in California’s political guerrilla war between state and local officials over housing.

The Legislature and Gov. Gavin Newsom have issued a steady stream of laws and regulations aimed at forcing the state’s nearly 500 cities to embrace housing development, particularly apartments for low-income families.

Communities that shun such housing, saying it degrades the bucolic ambience of their neighborhoods, respond by dragging their feet, challenging the state’s authority in court or fashioning new barriers. The state counters with threats to cut off funds for public works, more laws that supersede local land use authority, and threats of lawsuits.

Two such clashes have surfaced in recent weeks: one involving Portola Valley, a very affluent village on the San Francisco Peninsula, the other a coalition of cities governed by their own charters, rather than state law.

In January, Portola Valley became one of the first Bay Area communities to have its “housing element” — a plan for meeting housing quotas — approved by the state Department of Housing and Community Development.

By late March, Portola Valley became the first California city to have its housing element decertified. State officials said the town’s council had failed to make the necessary changes in zoning to accommodate the 253 housing units in its quota.

Portola Valley’s wealthy residents and officials obviously don’t want affordable apartments that would alter its rustic atmosphere, but if they continue to stall they run the risk of triggering the so-called “builder’s remedy,” under which projects could proceed without local approval.

Portola Valley officialdom says it intends to comply with the state’s demands, but it’s still uncertain whether apartments will actually be built, given land costs and other financial hurdles. Moreover, many neighborhoods have homeowner associations that impose their own rules on what can be built and could try to thwart multi-family projects.

The second battleground is the Los Angeles County Superior Court where Judge Curtis Kin ruled this month that one of the Legislature’s most powerful laws aimed at forcing cities to accept more housing does not apply to cities with their own charters.

Senate Bill 9, passed in 2021, effectively ended single-family zoning in California, allowing up to four units of housing to be built on a residential parcel. Five charter cities in Southern California — Redondo Beach, Carson, Torrance, Whittier and Del Mar — joined forces to sue the state, contending that the law does not apply to them.

Judge Kin agreed, ruling that while SB 9 purports to encourage housing affordable to low- and moderate-income families, it does not specifically limit its impact to that category and therefore cannot supersede land use powers of charter cities.

“Because the provisions of SB 9 are not reasonably related and sufficiently narrowly tailored to the explicit stated purpose of that legislation — namely, to ensure access to affordable housing — SB 9 cannot stand,” Kin wrote.

While California has nearly 500 incorporated cities, most operate as “general law” municipalities governed by state law, but about a quarter of them, mostly larger cities such as Los Angeles and San Diego, have their own charters. State laws, such as SB 9, can be applied to them only if the state declares a specific and overriding purpose.

The state could — and probably will — appeal Kin’s ruling, but the Legislature could also refine the law to make it more specific, either limiting its impact to low-income projects or changing its stated purpose to increase all kinds of housing.

It’s, therefore, likely that the cities that sued and other charter cities will only temporarily benefit, if at all, from Kin’s ruling. It’s just another skirmish in the never-ending war.

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: Key Questions About California Budget Deficit Unanswered as Deadlines Loom https://timesofsandiego.com/opinion/2024/04/27/key-questions-about-california-budget-deficit-unanswered-as-deadlines-loom/ Sun, 28 Apr 2024 05:05:00 +0000 https://timesofsandiego.com/?p=270828 Gov. Gavin NewsomCalifornia has a multibillion-dollar budget deficit, but we still don’t know how much and what should be done to close it with key deadlines quickly approaching.]]> Gov. Gavin Newsom
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Gov. Gavin Newsom presents his budget plan in Sacramento in January. Courtesy of the governor’s office

The must-follow website this month among California’s politicians, bureaucrats and interest group lobbyists is the “California Personal Income Tax Daily Revenue Tracker” that’s updated daily by the state controller’s office.

Last week was the deadline for filing personal income tax returns, and income taxes are by far the most important source of state revenue. What’s collected this month will have a big effect on the size of the state budget deficit that Gov. Gavin Newsom and legislators must cover, at least on paper, by June 15.

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Before April, state revenues from all sources were running $5.6 billion below what Newsom had projected for the current fiscal year in his proposed 2024-25 budget, according to the governor’s budget staff.

The shortfall indicated that the deficit Newsom pegged at $38 billion for the 2023-24 and 2024-25 fiscal years would be substantially greater. The Legislature’s budget analyst, Gabe Petek, declared that under Newsom’s budget the deficit was really $58 billion and that revenue shortfalls already experienced and projected to worsen would push the gap to $73 billion.

The immense disparity between the Newsom administration’s budget picture and Petek’s analysis remains unresolved, but the net personal income tax collections tracked by the controller’s office so far in April appear to be hitting the $16.3 billion administration estimate for the month.

What happens in the seven-plus weeks remaining before the June 15 constitutional deadline for budget passage will center on two related factors: settling on a deficit number and deciding what actions can be taken that would reduce it to zero.

Newsom will release a revised budget in May that probably will peg a deficit that’s larger than what he declared in January in his original budget, but smaller than Petek’s. Newsom will also declare that a recent agreement with legislative leaders on a package of spending cuts, deferrals, loans and other actions will initially reduce the deficit by $17 billion.

Newsom and legislative leaders have every reason, from a political standpoint, to minimize the deficit figure and use as many tools as possible, including gimmicks, to close it.

For instance, Newsom proposes to shift the June 2025 state payroll into July, thus moving several billion dollars of expense from one fiscal year to another. That doesn’t actually save any money, of course, but on paper it reduces the 2024-25 deficit.

The payroll gimmick and other maneuvers, such as borrowing money from special funds and calling it revenue, and tapping into the state’s “rainy day” reserves for at least $12 billion, are aimed at getting through one budget cycle while minimizing real reductions in spending that Democratic legislators, public employee unions and advocates for particular programs would dislike.

Taking the path of least political resistance, however, would simply postpone the day of reckoning because both Petek and Newsom’s budget advisors have said the state faces multibillion-dollar deficits each year for the remainder of Newsom’s governorship. 

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: Speculation Growing That Atty. Gen. Rob Bonta Will Enter Race for Governor https://timesofsandiego.com/opinion/2024/04/23/speculation-growing-that-atty-gen-rob-bonta-will-enter-race-for-governor/ Wed, 24 Apr 2024 05:05:00 +0000 https://timesofsandiego.com/?p=270404 Rob BontaA handful of Democratic politicians are already running for governor of California in 2026. Attorney General Rob Bonta is acting as if he might jump in. But so far there are no Latinos or Republicans in the mix.]]> Rob Bonta
Rob Bonta
Atty. Gen. Rob Bonta speaks at a food bank in San Diego. Image from X video

California Attorney General Rob Bonta has been busy lately, or so it would seem from the never-ending stream of press releases from the Department of Justice.

If he’s not announcing successful prosecution for possession of child pornography (April 11) or commenting on a U.S. Supreme Court decision (April 12), Bonta’s staging a news conference to announce a lawsuit against the city of Huntington Beach for imposing its own voting requirements (April 14), releasing final regulations of one-line charities (April 16), or declaring outcome of investigation into an officer-involved shooting (April 17).

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Gov. Gavin Newsom appointed Bonta to his position three years ago, succeeding Xavier Becerra, who became U.S. secretary of health and welfare.

Were Bonta merely seeking a full term as attorney general in 2026, he wouldn’t need so much publicity-seeking activity. It would be a political cakewalk.

However, if he’s setting the stage to run for governor two years hence, he would be doing exactly what he is doing: maximizing his official actions to build his image as an effective officeholder.

Bonta hasn’t said he is running for governor, but while occupying what is arguably the state’s second most powerful office, he needn’t do so yet. Attorneys general are automatically listed as potential candidates for governor.

In recent history, governors Pat Brown, George Deukmejian and Jerry Brown all had been AGs and three others made bids, Evelle Younger (1978), John Van de Kamp (1990) and Dan Lungren (1998).

While Bonta could be, and probably is, running a shadow campaign under the guise of official duties, his would-be opponents don’t have that luxury.

Lt. Gov. Eleni Kounalakis is running, and a couple of recent governors used her office as a launch pad — Gray Davis in 1998 and Newsom in 2018. But they were, in a sense, flukes because lieutenant governors have virtually no official duties and draw almost no media attention.

As mayor of San Francisco, Newsom wanted to run for governor in 2010, but was shouldered aside by Jerry Brown. With obvious reluctance, instead Newsom ran for lieutenant governor after deriding the office as having “no real authority and no real portfolio.”

Despite the obscurity of her office Kounalakis does have two potential advantages — her experience as ambassador to Hungary and very substantial family wealth — that could help her gain one of the two runoff spots in the 2026 open primary. Her father, Angelo Tsakopoulos, is a wealthy land developer in Sacramento who is also a major Democratic campaign contributor.

One other statewide officer, state schools Superintendent Tony Thurmond, is also in the mix and has been making numerous public appearances in that role to boost his image. Toni Atkins, former president pro tem of the state Senate, and former Controller Betty Yee have also declared their candidacies.

There may be more coming. Latinos are California’s largest ethnic bloc, but so far no candidate is Latino. It would be stunning if the 2026 election didn’t have at least one Latino candidate. Becerra, Bonta’s predecessor as attorney general, is believed to be weighing a run.

So what about the Republicans? The GOP bench is thin to the point of transparency. While it may be impossible for the party to win, the presence of a Republican candidate — no matter how weak — could change the dynamics of having a large field of Democrats running in a top-two primary system.

That’s exactly what happened in the March primary for U.S. Senate. The late entry of Republican Steve Garvey, a former baseball star, blocked what could have been a Democrat vs. Democrat run-off by finishing second, thanks in part to being indirectly aided by the Democratic frontrunner, Rep. Adam Schiff.

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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Opinion: California’s ‘Scattergun’ Approach to Homeless Crisis Isn’t Working https://timesofsandiego.com/opinion/2024/04/20/californias-scattergun-approach-to-homeless-crisis-isnt-working/ Sun, 21 Apr 2024 05:05:00 +0000 https://timesofsandiego.com/?p=270135 Homeless in San FranciscoCalifornia has created many programs to battle the scourge of homelessness, but a new audit says the agency created to coordinate those programs has failed to do its job.]]> Homeless in San Francisco
Homeless in San Francisco
A woman walks past men passed out on the sidewalk in the Tenderloin district of San Francisco. REUTERS/Shannon Stapleton

A duck hunter fires a shotgun in hopes that at least one of its many pellets will strike a fast-moving bird. A deer hunter fires a rifle to send one bullet toward his stationary prey, hoping to score a quick kill.

When responding to perceived crises, California’s politicians often take the scattergun approach, implementing multiple programs in multiple agencies hoping some will work, rather than carefully aiming a solution at a clearly defined problem.

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One example of the syndrome is the many programs governors and legislators have implemented to bolster the state’s economy during downturns. Once created, the programs take on lives of their own, continue operating long after the economy has recovered and are rarely compelled to justify their existence.

Another is the state’s seemingly countless efforts — both legislation and administrative decrees, scattered among a plethora of agencies — to reach the holy grail of carbon emission neutrality with little or no evaluation of their cost-effectiveness.

California’s current crisis d’jour is the ever-increasing number of men, women and children who lack homes, many of them living in squalid encampments on sidewalks and in urban greenbelts.

Polling has found that homelessness is consistently listed among Californians’ most pressing concerns. Gov. Gavin Newsom and the Legislature have repeatedly promised to deal with it and they have, as usual, enacted a stream of costly programs with catchy names they hope will have some positive impacts. Some provide housing and others purporting to treat the underlying issues, such as substance abuse and mental health, that force people into the streets.

The question, of course, is whether any of the efforts have made a difference.

In macro terms, the answer is no. The number of homeless Californians has increased by 50% in the last decade and 20% since Newsom became governor in 2019, despite the state’s spending about $20 billion on the various anti-homelessness programs during the last five years.

Those data come from a new and sharply critical report on homelessness programs by State Auditor Grant Parks, following up on a 2021 audit which found that a “lack of coordination among the state’s homelessness programs had hampered the effectiveness of the state’s efforts to end homelessness.”

The 2021 audit’s criticism rang true even though the state had created the California Interagency Council on Homelessness in 2017 to coordinate homelessness activities. After the 2021 audit and under pressure from the Legislature, the agency adopted an “action plan” with specific goals to achieve and orders to report on results.

However, the new audit, which was released at the beginning of the month, said the homelessness council has been tardy in reporting on outcomes, “has not aligned its action plan for addressing homelessness with its statutory goals,” and has not collected accurate data on the many specific programs.

“Until Cal ICH takes these critical steps, the state will lack up‑to‑date information that it can use to make data‑driven policy decisions on how to effectively reduce homelessness,” the audit said.

Meanwhile, the proliferation of anti-homelessness programs continues. Just last month, voters — by the thinnest of margins — approved Newsom’s multibillion-dollar plan to overhaul mental health treatment in California, including providing more housing for those with ailments.

The fact that his measure, Proposition 1, barely survived despite many millions of dollars being spent on the campaign for it, indicates anew that Californians are growing weary of politicians’ promises to end the crisis.

The new audit implies that the public’s skepticism is well-founded. If the agency created to coordinate homelessness responses is falling short of its mission, why should we think that any specific programs are having a lasting impact?

CalMatters is a public interest journalism venture committed to explaining how California’s state Capitol works and why it matters.

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