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IN THIS ISSUE – “Even in Blue California, There Are Limits”

ELECTION 2020

SUSTAINABILITY

FOR THE WEEK ENDING MAR. 13, 2020

Capital News & Notes (CN&N) harvests California legislative and regulatory insights from dozens of media and official sources for the past week, tailored to your business and advocacy interests.  Please feel free to forward.

Stay current daily!  For our focused updates via Twitter: @jrgualco / @robertjgore / @gualcogroup

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Taxpayer Fatigue? Bond Defeats Add Up

Sacramento Bee & CalMatters

California voters have rejected a proposition to sell $15 billion in bonds to fund repairs and upgrades to aging school buildings.

The results deal a defeat to Gov. Gavin Newsom, education organizations and developers who funded the measure.

Results reported by The Associated Press show the measure failing by 8 percentage points, with just 46 percent of voters supporting the measure, which appeared on California primary ballots as Proposition 13.

Supporters reported raising more than $12 million to support the measure, according to campaign finance disclosures filed with the Secretary of State’s office. They argued California schools needed the bond funding to build new classrooms, upgrade existing buildings and eliminate lead and asbestos from buildings.

Opponents did not spend much money fighting the proposal.

The Howard Jarvis Taxpayers Association reported spending $250,000 on statewide radio ads urging voters to reject it, said Jon Coupal, the group’s president. Opponents argued the state should not fund school repairs using bond funding, which would require the state to make interest payments.

The nonpartisan Legislative Analyst’s Office predicted that the state would pay $26 billion over 35 years to cover the bonds.

The defeat is something of a shock. Public schools are popular in California and school bond issues generally enjoy strong voter support.

It’s a setback for housing developers who would have benefited from a provision exempting them from some local school impact fees.

It’s possible, even probable, that the bond issue’s ballot designation, Proposition 13, contributed to its demise. A 1978 measure, also Proposition 13, is one of the most iconic political events in California history, sharply curtailing the growth of property taxes.

Some voters clearly thought that 2020’s Proposition 13 would somehow affect 1978’s Proposition 13. Although inaccurate, that notion was probably sparked by campaigning on another ballot measure expected to appear on the November ballot that would allow higher levies on commercial property. Opponents warn that it could be the first step toward repeal of 1978’s Proposition 13, so it’s understandable that some voters would be confused.

Nevertheless, the apparent defeat of the school bond may be much more than a case of mistaken identity. It could reflect rising resistance to new borrowing and new taxes.

The Public Policy Institute of California’s recent polling of voters has found that “At least a majority — but never more than two-thirds — in every place in the state believes taxes are too high (and) overall, 58% hold this opinion.”

Meanwhile, the California Taxpayers Association calculates that more than half of 236 local tax measures are being rejected.

Last year, Policy Analysis for California Education (PACE), a university consortium devoted to research on education issues, issued a study on the attitudes of very affluent and very liberal voters in Marin County.

It noted that after years of routine voter approval of parcel taxes for local schools, “In 2016, something shifted. Voters in upscale Kentfield rejected the renewal of a previously popular school parcel tax, which had most recently passed with 72% of the vote in 2008. In nearby Mill Valley, a parcel tax that made up approximately 20% of the district’s budget passed by fewer than 25 votes, even though it had passed with 74% of the vote in 2008.”

PACE said that many Marin voters “had become concerned that some local leaders were choosing to increase taxes rather than grapple with necessary fiscal reforms” and asked a pithy question: “If the highly progressive residents of Marin County have become less willing to financially support their local school districts, what does this mean for less wealthy regions of California?”

Last year, voters in Los Angeles, who are much less affluent than those in Marin, stunned local political leaders by overwhelmingly rejecting a $500 million per year increase in parcel taxes — a form of property tax not limited by 1978’s Proposition 13 — for the Los Angeles Unified School District.

Meanwhile, the California Taxpayers Association calculates that at least half of 236 local tax measures are headed to defeat.

Given voter rejection of Measure EE in Los Angeles and now the apparent loss by Newsom’s school bond measure, the sponsors of the split roll initiative — public employee unions, mostly — should be very worried about the November election.

Polling on the split roll already indicates weak support at best and the commercial real estate industry has pledged to spend $100 million or more to defeat it.

Advocates of more spending, borrowing and taxes may be learning that even in blue California, there are limits.

https://calmatters.org/commentary/school-bond-issue-rejection-taxesl/?utm_source=CalMatters%20Newsletters&utm_campaign=90f3b61910-WHATMATTERS_NEWSLETTER&utm_medium=email&utm_term=0_faa7be558d-90f3b61910-150181777&mc_cid=90f3b61910&mc_eid=2833f18cca

https://www.sacbee.com/article241099491.html#storylink=cpy

 

California Political Geography Charts Changes

Public Policy Institute of California

California and the nation are in the midst of a highly consequential election year. While the state leans Democratic overall, a close look at party affiliation across regions provides a more complete picture of California’s ever-evolving political landscape. Also, views on some key issues have their own geographic patterns that transcend partisan lines.

https://www.ppic.org/wp-content/uploads/californias-political-geography-2020.pdf

 

Census Begins; Congressional Seat May Be Lost

Capitol Weekly

Amid the piles of bills and other notices in the mail, a special invitation to complete the national census is coming to Californians beginning this week.

The census, which happens once every 10 years, is a mammoth effort to get a snapshot of who is living here as of April 1. The results will be used to determine everything from Congressional representation to federal funding for health, education, child care and transportation. Preliminary estimates by the state Department of Finance that were released in December put California’s population at 39.96 million.

California is spending $187.2 million in a statewide outreach and communications campaign to encourage residents to participate. “Don’t let anyone count you out,” said first partner Jennifer Siebel Newsom in a video posted on the official state site californiacensus.org. “This is your state and your country and you deserve to be counted.”

Though federal law requires all residents to fill out a census form, getting full compliance likely won’t be easy.

“Every 10 years, our public becomes a little more distrusting of government and a little more wanting to be private,” said Paul Mitchell, vice president of Political Data, Inc. “They may put up their vacation photos on Instagram, but they don’t want the government to know where they live.”

On top of that, some wonder whether fears about COVID-19, the coronavirus, will deter people from filling out the census. Garry South, a Democratic strategist said anything that disrupts life – from hurricanes to earthquakes to a public health crisis, does potentially have an effect on the count.

One thing that should alleviate concerns, however, is that this year, for the first time, most people can fill the census form out online, without interacting with any strangers. Invitations in the mail will explain how to do it.  There will also be options to answer census questions by mail or by phone.  The government will only send out census workers to knock on doors of people who do respond.

The list of questions that will be asked in the census includes how many people, including children, live in the home or apartment, their names, ages and sexes and how they are related. The census will not ask for Social security numbers, financial account information or citizenship status. President Trump had pushed for inclusion of a citizenship question last year but was blocked by the Supreme Court.

Still, the news coverage of that will likely make it harder to count undocumented immigrants, said Mike Madrid, a veteran Republican strategist. “There is a palpable fear in Latino communities about interacting with the census,” he said. “The Trump administration has been successful to this point in engendering that fear.”

Undocumented residents worry that if they complete the census form, they will be deported. “I think there is going to be a very significant undercount, which is the objective of the Trump administration,” Madrid said.

The undercount is serious because it means policymakers won’t get the data they need to make decisions, he added. “The accuracy of data is everything,” he said. “Without that accuracy, you’re not getting an accurate reflection of what’s happening in America. The weaker the data, the weaker the decision.”

According to an analysis from the Brookings Institution, California is projected to lose a Congressional seat for the first time in its history after census results come out, decreasing its number from 53 seats to 52. There are a maximum of 435 congressional seats to allocate to all the states. Though California may not lose residents, it’s not growing as fast as other states and therefore will likely lose one seat.

South said it shouldn’t detract from California’s clout on the national stage if it loses one seat since it already has so many. However, he said it will be interesting to see how the remaining 52 seats will be configured. Redrawing the district maps may change the ethnic makeup of some districts – for instance, some districts that have been African-American may be reconfigured to have a majority Latino population, South said.

https://capitolweekly.net/the-census-dont-let-anyone-count-you-out/

 

“Gentler” Residential Up-Zoning Bill Proposed

CalMatters

For three straight years, state Sen. Scott Wiener has tried to force California cities to swallow more apartment buildings near public transit, arguing it’s the only way the state can fill its crippling housing shortage and meet its ambitious climate goals.

For three straight years, a shifting coalition of local governments, affluent suburban homeowners and anti-gentrification groups have sunk the San Francisco Democrat’s plans. Their argument: local control over what types of housing gets built where preserves the look and feel of neighborhoods cherished by generations of Californians.

Now, just two months after his controversial Senate Bill 50 was unexpectedly voted down by both Democrats and Republicans, Wiener is back yet again…with a decidedly “gentler” touch.

If the the early iterations of SB 50 were a shot of urban growth hormone designed to force cities across the state to grow up (literally — although developers and pro-housing advocates would likely say figuratively too), SB 902 is more like a density vitamin cities could choose to take only if they felt like it.

“We think this legislation will over time allow for a significant increase in the amount of housing, and will do it in a way that is a light touch,” said Wiener, unveiling details of his bill to reporters. “And also in a way where cities have significant latitude in how they do it.”

Here’s what you need to know about the latest attempt to goad California into building more housing:

Wiener’s new bill retains one highly controversial proposal: the elimination of single-family only zoning across nearly every neighborhood in California.

The new bill would force localities to permit duplexes in neighborhoods where they are currently illegal in cities of less than 10,000 people, triplexes in cities with populations between 10,000 and 50,000, and fourplexes in cities over 50,000. Single-family-only neighborhoods in high fire-risk areas would be exempt.

Developers would not be required to build denser structures next to single family homes in these cities — they would simply be allowed to. Homeowners could choose to demolish their property and rebuild it more densely, as long as a renter hasn’t lived there for the past seven years.

The idea of loosening local zoning rules has gained traction in national progressive circles, with Democratic presidential candidates such as Bernie Sanders advocating for tying federal funds to denser housing. Democratic lawmakers in Minneapolis and Oregon opted to prohibit single-family-only zoning last year.

Technically, California ended single-family-only zoning with the passage of a 2019 law that allows homeowners statewide to build granny flats in their backyards. But Wiener’s latest proposal would allow for more visible neighborhood change, and is thus sure to engender more pushback.

“I think (single-family zoning) is a good thing,” countered Susan Kirsch, an influential anti-growth activist from Marin County who has helped organize opposition to Wiener’s previous legislative efforts.

“Maybe not for every city. But at least it should be maintained as an option for any city.”

Wiener had previously tried to force “high-opportunity” communities like the affluent West L.A. enclave, places with good schools and close to major job centers, to allow mid-rise apartment buildings next to single-family homes. Cities would also have to allow new apartments within a half-mile of major public transit stops.

His new proposal leaves the decision on whether to allow denser housing around transit and good jobs to the Beverly Hills City Council — the same council that passed a unanimous resolution opposing his previous effort.

If a local government passes a resolution to rezone a neighborhood for more density (up to 10 homes per piece of land), Wiener’s new proposal would allow that city to bypass environmental reviews. Pro-development forces complain that those reviews are costly, time-consuming and subject to endless litigation.

The bill may be attractive to larger cities already interested in revamping their zoning laws in search of denser housing, such as Oakland and Los Angeles. But will smaller, traditionally anti-growth locales like Beverly Hills or Marin County jump at the opportunity to make it easier to build more apartments?

Wiener argues they may not have much of a choice. New state mandates have dramatically increased how much housing Southern California cities must plan for. Beverly Hills saw its eight-year housing planning quota jump from single digits to 3,000.

“It’s a tool, and I think not all cities will want to use it, but some will,” said Wiener. “I think quite a few will.”

Wiener hopes that by allowing cities to opt in to his new bill’s more aggressive upzoning measures, he’ll also soften opposition from some anti-gentrification groups that feared the development of new, shiny apartment buildings would lead to rising rents in lower-income communities of color.

But noticeably absent from the bill is any mention of subsidized housing for lower-income Californians, an issue Wiener never fully resolved with equity advocates in his earlier legislative attempts.

While smaller-scale multi-plexes are often exempted from laws requiring set-asides for low-income housing, the lack of an “inclusionary” provision will likely resurface as a point of contention.

After the failure of SB 50 in January, Gov. Gavin Newsom vowed he would lead the charge for a signature housing production bill to meet his goal of 3.5 million new homes by 2025.

In comments to reporters prior to the bill’s official language being released, Wiener stressed that SB 902 was only one of a handful of housing production bills Democratic state leadership will be considering in the coming weeks. So maybe instead of one replacement, several.

“This bill will be part of a package of bills that will increase housing production this year,” said Wiener. “I’m looking at this as a suite of bills that will try to move the dial.”

https://calmatters.org/housing/2020/03/end-single-family-zoning-california-wiener-housing-production-bill/?utm_source=CalMatters+Newsletters&utm_campaign=083c090841-WHATMATTERS_NEWSLETTER&utm_medium=email&utm_term=0_faa7be558d-083c090841-150181777&mc_cid=083c090841&mc_eid=2833f18cca

 

Europe Proposes No-Waste “Circular Economy”…Will California Follow?

Politico Europe

Brussels wants people to buy fewer clothes, fix and not ditch smartphones and recycle instead of dumping things in the trash — all part of an effort to slash resource use.

The European Commission unveiled its Circular Economy Action Plan — tackling everything from clamping down on waste to mandating a greater use of recycled materials in new products, and hammering home the principles of reduce, reuse and recycle.

It’s part of a broader environmental shift by the Commission that includes the Green Deal and Industrial Strategy and aims to make the bloc climate neutral by 2050.

The idea is to lessen humanity’s impact on the planet — an effort that’s driven by rising public disquiet over everything from climate change to masses of plastic trash in the oceans.

“We only have one Planet Earth, and yet by 2050 we will be consuming as if we had three,” said Environment Commissioner Virginijus Sinkevičius.

The real battles are still to come as the Commission will gradually roll out the 35 pieces of legislation outlined in the plan’s annex over the next three years.

Here are five takeaways:

1. The idea is to change everything

The document wants bans on the destruction of unsold goods and built-in obsolescence — the term for companies making products designed to eventually stop working and then be replaced. It also includes an EU strategy to clean up textile production and regulatory measures that would require electronics manufacturers to make products like mobile phones, tablets and earphones easier to repair and recycle.

But having more sustainable products won’t be enough to make the economy more circular. The Commission also needs people to change their consumption habits, and maybe feel a little guiltier about wasteful behavior.

“It’s not just about reusing, recycling, it’s also about creating a new relationship with the products we have,” Executive Vice President Frans Timmermans said Friday during the launch of the European Plastics Pact — a voluntary agreement among governments and companies to cut plastic waste. “They need to live longer … to be fully recyclable, they need to be repairable.”

The plan also wants companies to develop new business models based on product-as-service. “Instead of buying a washing machine, you buy the service of washing,” Timmermans said, adding that by doing so “you take the incentive away to not make the machine durable so that you can sell another machine three or four years down the line.”

2. Tech is under special scrutiny

The Commission is tired of the tech sector introducing new chargers every few years, so it will demand that all manufacturers use a common charger.

“We see a situation now [in which] Samsung came last year with a new charger, and the same happened with Apple who changed their USB port … so we definitely need to seek for the universal one,” Sinkevičius said ahead of the launch.

He acknowledged that such a change cannot happen overnight as that would only create more waste. “There has to be a smart timing when it can be introduced, of course the producers will also need their time to adjust, but we definitely need to have [a] set date legislation when we’re moving to reach it,” the commissioner said.

3. It goes soft on fashion

The plan includes an EU Strategy for Textiles — to be proposed in 2021 — that will take a carrot rather than stick approach to cleaning up the fashion industry. It will be focused on research and ecodesign measures, as well as helping people get better access to re-use and repair services, instead of mandating tough targets.

“We’re not going to set the goal of how much textiles are going to be recycled or reused,” said Sinkevičius.

4. Money, money, money

To completely revamp the bloc’s economy to a more circular model, the Commission wants to steer investments by developing an EU ecolabel for financial products.

The Commission already started in 2018 developing criteria for sustainable financial products.

Other financial tools include encouraging the broad application of environmental taxation, including landfill and incineration taxes, as well as using VAT rates to promote the circular economy.

5. Upcoming battles

Unlike some of the Commission’s other grandiose ideas, the circular economy plan has strong public backing and there isn’t a unified bloc of member countries opposed to the idea. That doesn’t mean everyone is on board.

Czech Deputy Minister Vladislav Smrž said during the Environment Council last week that the previous Circular Economy Action Plan from 2015 and the Single-Use Plastics Directive already set “quite extensive” targets for waste and packaging — most of which have not yet been implemented in national legislation.

https://www.politico.eu/article/throwing-away-throwaway-society/

 

Insurers Fuel Coal-Power Burnout

Yale e-360

With the fuel unable to compete in most places with natural gas, nuclear, and renewables, the mining and burning of coal is increasingly toxic economically as well as environmentally. Coal mines are becoming “stranded assets” — unlikely ever to pay off the costs of their development. The risks for financiers are becoming too great.

Now, even insurance companies are refusing to underwrite coal-fired power plants and coal mining ventures. And without insurance, say gleeful climate campaigners, coal is dead.

Coal burning worldwide fell a further 3 percent last year, the biggest decline yet from a peak in 2013. That trend is unlikely to change. The number of new coal plants that began construction worldwide fell by 84 percent between 2015 and 2018, according to NGOs tracking the demise. Across the developed world, coal’s contribution to keeping the lights on is in freefall.

Despite the Trump administration’s dismissal of the climate crisis, the U.S. is proving no exception. Twelve years ago, 45 percent of U.S. electricity was generated by burning coal. The figure is now 24 percent and falling fast. Since Trump arrived in the White House, 39,000 megawatts of coal-burning power plants have been retired across the U.S. and none commissioned. Starved of markets, eight U.S. coal mining companies filed for bankruptcy last year

The imperative to wean the world off coal is a no-brainer. Coal is the dirtiest major fuel. Burning it produces roughly twice as much CO2 for every unit of energy output as natural gas. It is currently responsible for around 30 percent of global energy-related CO2 emissions.

Investors face growing pressure to pull the plug on coal from climate campaigners, many of whom see shutting off financing as the best route to hobble the fossil fuel industry. And investors see little reason to push back against the pressure since coal represents an escalating financial as well as reputational risk as demand shrinks, regulators turn up the heat on CO2 emissions, and rival cleaner fuels become cheaper.

In the past year, insurance companies have increasingly been making a rush for the exits, too. European insurance companies have led the way, with the French giant Axa, Britain’s Aviva, Germany’s Allianz, and Zurich Insurance among more than a dozen major firms limiting their exposure to coal. Typically, they will no longer underwrite coal projects or companies that get more than 30 percent of their revenue from mining or burning coal. But some, such as Axa, promise a total exit by 2030 in developed nations and by 2040 globally.

The insurers say that besides their concern about the future viability of coal companies, they fear the growing risks from climate disasters facing almost every other business they insure. In June, Zurich CEO Mario Greco explained that “as one of the world’s leading insurers, we see first-hand the devastation natural disasters inflict on people and communities. This is why we are accelerating action to reduce climate risk by driving changes in how companies and people behave and support those most impacted. It is simply the right thing to do.”

https://e360.yale.edu/features/as-investors-and-insurers-back-away-the-economics-of-coal-turn-toxic