Capital News & Notes
For Clients & Friends of The Gualco Group, Inc.
IN THIS ISSUE – “California is Mobilizing Every Part of Government”
COVID-19 & THE CAPITAL
- “Challenging Times”: Legislature Suspends Session
- State Services in Flux
- COVID-19 Recession Hits West Coast Hardest
- Last Look at a Healthy Economy
PRIMARY ELECTION LINGERS
- Local Officials “Stunned” As Tax Increase Measures Fail
- CA Republican Party Struggles to Maintain Relevance
HOUSING
- Will Vacant Homes >90 Days Become Illegal?
- CA Housing Prices Good for AZ
SURVIVAL OF THE CLEANEST
- Dirtier Than A Toilet and It’s In Your Ear; Cell Phone Cleansing in the COVID Era
FOR THE WEEK ENDING MAR. 20, 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
READ ALL ABOUT IT!!
“Challenging Times”: Legislature Suspends Session
Sacramento Bee
The California Legislature voted to suspend its 2020 session for nearly a month in response to the coronavirus outbreak that has infected hundreds of Californians and killed at least six people.
Lawmakers Monday night voted unanimously to recess from March 20 until April 13, though that date is subject to change.
The decision concluded a tense day at the Capitol during which the Senate and Assembly each gathered for about seven hours to pass a relief package that sends $1.1 billion in support to hospitals, facilities, local governments and schools to mitigate the spread of the virus called COVID-19.
“Responding to the coronavirus is one of the biggest challenges to face the California Legislature in modern times,” said Senate President pro Tem Toni Atkins, D-San Diego. “The responsible thing for us to do is flatten the curve, reduce transmission, keep our health care system above water. That is the intent of the action we are taking.”
The Senate also approved the suspension on a 32-0 vote. Capitol and district staff will be allowed to work from home or remotely during the break.
The votes followed Gov. Gavin Newsom’s executive order on Sunday asking Californians over age 65 to isolate themselves at home.
On Monday, Democratic leaders in both the Senate and Assembly had allowed members older than 65 to miss session on Monday, though several members who met that criteria still showed up for votes.
“The passage of this motion gives me no pleasure, but it’s necessary,” said Assembly Speaker Anthony Rendon, D-Lakewood, before the Assembly approved the break on a 68-0 vote. “It is a request to step away from our desks much earlier than we’d like. The demands of public health require it.”
Newsom also announced late Monday an executive order that allows local jurisdictions to ban evictions and home foreclosures for residents who can’t pay the bills due to the financial squeeze of the coronavirus. He said Californians should stop gathering in groups entirely for the foreseeable future and that he now recommends restaurants stop serving meals in their establishments.
“These will be challenging times and California is mobilizing every part of government to protect and isolate residents most vulnerable to COVID-19,” Newsom said in a statement.
The governor said Monday evening that the number of infected Californians has increased to 392, a 15 percent increase from the day before. At least six people have died, though two more on Monday were announced, a homeless person in Santa Clara County and another person in Sacramento County.
Rendon said the break was “not a vacation” and that the Legislature’s work to combat homelessness, address income inequality and stymie climate change remains a high priority.
Senate Republican Leader Shannon Grove of Bakersfield said the break will allow members to more closely work in their communities, hard hit by school closures, economic uncertainty and, in some areas, growing clusters of the virus.
“Our work will become harder than all of us being right here in this building trying to address legislative issues that might come up,” Grove said. “We are headed home to harder work than we’ve ever faced in this building.”
https://www.sacbee.com/news/coronavirus/article241256206.html?#storylink=cpy
Sacramento Bee
Like many of her California state worker colleagues, Annabel Vera has been watching the news with increasing concern.
Officials limited gatherings to 250 people, then 50, then 10 to limit the spread of coronavirus, yet many state workers are still going to work.
“We all work in buildings where there are thousands of people there,” said Vera, 29, an analyst at the Department of Social Services office in Sacramento. “You’ll have 10 people or more in an elevator just getting to your cubicle.”
She and two friends wanted to do something about it, so a week ago they launched an online petition demanding Gov. Gavin Newsom allow teleworking for all state employees who can do it, guarantee paid sick leave and provide sanitation and protective equipment.
Now the petition has more than 700 signatures. And many state workers are still reporting to crowded offices to do work they feel they could accomplish from home.
California Department of Human Resources Director Eraina Ortega issued a directive supporting telework Tuesday night. More workers are starting to get telecommuting agreements today, but their availability still varies greatly from department to department and manager to manager, according to state workers and some unions.
“Really what I’ve seen on the ground is that people are seeing other units and seeing other people with similar jobs to theirs sent home, but they’re being asked to stay and come in to the office,” Vera said.
The petition doesn’t display the number of signups in real time. Vera said the group may deliver it to the Governor’s Office in some fashion, along with a total number of signups. The signup form asks for names, email addresses and departments.
Vera launched the petition along with Jillien Davey, 27, who works in the CalPERS investment office; and Elliott Stevenson, 34, who declined to identify the department where he works.
Vera and Davey each recently received telework agreements, but they’re continuing to promote the petition to try to get the agreements for more workers.
“I don’t feel like what we are asking for is too much,” Davey said.
The three know each other through their work on a labor subcommittee of the Democratic Socialists of America. They considered delivering their message to the Governor’s Office but quickly decided against that given the circumstances, so they decided on digital action. Vera said she initially expected maybe 50 responses. “It just shows me that people are really kind of yearning for a strong institutional response,” she said of the 700 signups.
https://www.sacbee.com/news/politics-government/the-state-worker/article241350391.html#storylink=cpy
COVID-19 Recession Hits West Coast Hardest
Sacramento Bee & UCLA Anderson Forecast
The U.S. economy has entered its first recession in 11 years, and it’s likely to be slightly more severe in California than the rest of the nation, a new forecast from the UCLA Anderson School of Management said Monday.
By the first quarter of 2021, California is expected to lose more than 280,000 payroll jobs, the report said. More than one-third of those jobs would be in leisure and hospitality and transportation and warehousing.
“For California, a state with a larger proportion of economic activity in tourism and trans-Pacific transportation, the economic downturn will be slightly more severe,” the report said.
It predicted employment would drop by 0.7% in 2020, with the second and third quarters contracting at an annual rate of 2.6%.
The unemployment rate should go up to 6.3% by the end of this year and is expected to continue to increase into 2021 with an average next year of 6.6%.
The new forecast, though, had a footnote: “If the pandemic is much worse than assumed, this forecast will be too optimistic. If the pandemic abates quickly because of the extraordinary measures being put into place to address it, an outcome that the medical community thinks unlikely but possible, then the forecast is too pessimistic and economic growth in the third and fourth quarters of the year will be higher.”
The forecast revised an outlook released just last week. It said the recession could continue through the end of September.
“After a solid start to 2020, the escalating impacts of the coronavirus pandemic in March have reduced the first-quarter 2020 forecast of GDP growth to 0.4%,” the report said.
GDP is the Gross Domestic Product, the value of the nation’s goods and services. The forecast predicts the GDP second quarter decline at 6.5% and the third quarter drop at 1.9%. Two quarters of declining GDP is usually considered a recession. The forecast does predict more normal activity in the fourth quarter of this year, with GDP growth of 4%. “For the full 2020 year, it is expected that GDP will have declined by 0.4%,” the report said. “In 2021, with the abatement of governmental pandemic expenditures and the continued contraction of residential and commercial construction, the economy is forecast to grow at only 1.5%. The full recovery and return to trend is now expected in 2022.”
https://www.sacbee.com/news/coronavirus/article241234036.html?#storylink=cpy
Economic research:
https://www.anderson.ucla.edu/centers/ucla-anderson-forecast
Last Look at a Healthy Economy
State Dept. of Finance Monthly Report for February
Cautioning that data do not reflect the COVID-19, the state Dept. of Finance issued its monthly report on the California economy:
REVENUE
Preliminary General Fund agency cash receipts for the first eight months of the fiscal year are $1.248 billion above the 2020-21 Governor’s Budget forecast of $87.605 billion. Cash receipts for the month of February were $181 million above the month’s forecast of $5.991 billion.
- Personal income tax cash receipts for the first eight months of the fiscal year are $1.665 billion above forecast. Personal income tax cash receipts to the General Fund were $257 million above the month’s forecast of $2.838 billion. Withholding cash receipts were $331 million above the forecast of $5.672 billion. Other cash receipts were $63 million higher than the forecast of $599 million. Refunds issued in February were $133 million higher than the forecast of $3.382 billion. Proposition 63 requires that 1.76 percent of total monthly personal income tax collections be transferred to the Mental Health Services Fund (MHSF). The amount transferred to the MHSF in February was $5 million above the forecast of $51 million.
- Sales and use tax cash receipts for the first eight months of the fiscal year are $10 million below forecast. Cash receipts for February were $49 million above the month’s forecast of $2.648 billion. February cash receipts include a portion of the final payment for fourth quarter 2019 sales, as well as the first prepayment for the first quarter 2020 sales.
- Corporation tax cash receipts for the first eight months of the fiscal year are $19 million below forecast. Cash receipts for February were $11 million above the month’s forecast of $251 million. Estimated payments were $47 million above the forecast of $135 million, and other payments were $34 million lower than the $220 million forecast. Total refunds for the month were $1 million higher than the forecast of $104 million.
JOBS
- California’s unemployment rate remained at 3.9 percent in January while the U.S. unemployment rate rose
0.1 percentage point to 3.6 percent in January before falling back to 3.5 percent in February. The state’s labor force participation rate rose 0.1 percentage point to 62.6 percent in January. - 21,400 jobs were added in January. Year-over-year job growth was 1.5 percent in the state compared to 1.4 percent in the nation. The six major industry sectors that added jobs in January were educational and health services (7,900), leisure and hospitality (7,800), information (5,500), trade, transportation, and utilities (3,400), other services (2,500), and government (1,100). The four major industry sectors that lost jobs were professional and business services (-3,300), construction (-2,400), manufacturing (-900), and financial activities (-200). Mining and logging was unchanged.
BUILDING & REAL ESTATE
- California housing units authorized by building permits increased 19.6 percent from December 2019 to a seasonally adjusted annualized rate of 142,000 housing units in January 2020, which is down 12.4 percent from January 2019. Single-family permit issuance was up 9.5 percent from the prior month and up 28.9 percent from the previous year to 73,000 single-family units in January 2020. Multifamily permit issuance increased by 32.5 percent from the prior month but decreased by 34.5 percent from the previous year to 69,000 multifamily units. Nonresidential valuation dropped from the prior month and year by 3.2 percent and 6.3 percent, respectively, to an annualized valuation of $30 billion in January 2020.
- Sales of existing, single-family detached homes in January totaled 395,550 units at a seasonally adjusted annualized rate, down 0.8 percent from the prior month but up 10.3 percent from the previous year.
- The median price of existing, single-family detached homes sold statewide in January was $575,160, down 6.5 percent from the prior month but up 7.1 percent from the previous year.
- The 30-year fixed-rate mortgage averaged 3.62 percent in January 2020, down from 3.72 percent in December and down from 4.46 percent in January 2019.
Local Officials “Stunned” As Tax Increase Measures Fail
CalMatters
The California Taxpayers Association has reported that more than half of the local measures appeared to fail on March 3, although some may squeak through when all votes are tallied.
One of the casualties appears to be San Diego’s Measure C, backed by Mayor Kevin Faulconer and local business and labor interests, which would have boosted hotel taxes for expansion of the city’s convention center, curbing homelessness and street repairs.
As of last week, Measure C had about 65% of San Diegans’ votes, a clear majority but shy of the two-thirds margin California law and San Diego’s city attorney say are required, thus folding it into a legal conflict that’s been simmering for the past three years.
State law says that “special purpose” taxes, which Measure C clearly is, must have two-thirds approval by voters. But three years ago, the state Supreme Court cast doubt on that principle in upholding the basic right of voters to impose taxes via the initiative process.
Writing the 5-2 majority opinion, Justice Mariano-Florentino Cuéllar declared, “Multiple provisions of the state Constitution explicitly constrain the power of local governments to raise taxes. But we will not lightly apply such restrictions on local governments to voter initiatives.”
He thus implied that special purpose taxes placed on the ballot by voters via initiative may not be affected by the two-thirds vote requirement, but was not explicit, touching off a running legal battle.
Since then, some special tax measures failing to receive two-thirds votes have been validated by local judges, citing Cuéllar’s opinion, but most have not.
An early test arose in two San Francisco tax measures, both placed on the ballot in 2018 via initiatives personally sponsored by members of the city’s Board of Supervisors, one for early childhood education, the other to battle homelessness. Both received less than two-thirds votes, but a local judge, Ethan Schulman, validated them anyway.
However, Fresno Superior Court Judge Kimberly Gaab went the other way on a sales tax measure to improve city parks. The tax hike received just 52.2% of the votes and when its sponsors sued to have it declared a winner, Gaab wrote, “The two-thirds vote requirement applies to all special tax proposals, regardless of the proponent of the proposal.”
Her interpretation was echoed by Alameda County Superior Court Judge Ronnie MacLaren as he declared a 2018 Oakland parcel tax for education a failure with 62% of the votes.
“Allowing Measure AA to be enacted with less than two-thirds of the votes would constitute a fraud on the voters,” Judge MacLaren wrote, noting that “the ballot measures prepared by the city unambiguously advised voters that Measure AA would require two-thirds of the votes to pass.”
San Diego voters were told the same thing, but backers of Measure C may take its validity to court should it fall short in the final count.
“What’s very clear is that a large majority of San Diegans support priorities in Measure C,” Rachel Laing, a spokeswoman for the support coalition said in a statement. “In the coming days, the coalition will discuss our options for how to move forward if the measure ultimately falls short of the two-thirds threshold.”
The earlier cases are already moving through the appellate process and eventually, the Supreme Court will have to tell us what it meant in that 2017 case. Sooner would be better than later as the roster of disputed tax measures grows.
https://calmatters.org/commentary/initiative-local-tax-vote-fail-san-diego/
CA Republican Party Struggles to Maintain Relevance
CalMatters
What to do when your party wants one thing, but your state wants another?
It’s a perennial quandary for the California GOP. And primary election results in Orange County are once again raising the question. Throughout California, local government and school officials have been stunned by voters’ reluctance this month to approve new taxes and bonds.
In a Westminster Assembly race, an incumbent Republican with a history of voting for Democratic legislation appears to have been kicked to the curb by members of his own party, failing to qualify for the general-election ballot thanks to a challenge from the right. The results are not yet final — the county is still tallying ballots — but already the message seems clear: GOP politicians stray from the hard party line at their peril.
In two neighboring state Senate districts, in Costa Mesa and Fullerton, Democratic candidates have earned more than half of the vote. That’s an ominous sign for the two Republican incumbents, both of whom will face single Democratic challengers in November.
The messages there: Orange County, like nearly every other county in the state, is drifting ever more reliably into the Democratic column. Politicians stick with the party label at their peril.
Thus, the quandary: Even in California’s top-two election system, candidates often need the support of the party’s stalwarts to make it to the general election. But they also often need support from an increasingly liberal general electorate to get into office.
“What’s evolved in California is a Republican Party dominated by hardcore conservatives, with the real action between factions of the Democratic Party,” said Jack Pitney, a political science professor at Claremont McKenna College.
California has not elected a Republican to statewide office since 2006. And in the 2018 “blue wave” midterm election, the GOP Congressional delegation was cut in half, while Democrats captured three-fourths of the state legislative seats. While President Trump remains popular with 84% of registered Republicans, according to a recent Public Policy Institute of California survey, only a third of likely voters overall share that view.
The California Republican Party’s withdrawal into the ideological wilderness has been exacerbated by a few defections. Just after the 2018 shellacking, San Diego Assemblyman Brian Maienschein changed the “R” after his name to a “D.” Late last year, Assemblyman Chad Mayes, a former legislative leader from Yucca Valley, left the GOP, ditching party affiliation entirely.
So far, neither seems to have been punished by voters. Maienschein has 57% of the counted vote against a Republican challenger, and Mayes has 35.4%, first among a Democratic and a Republican challenger.
In the Westminster race, Assemblyman Tyler Diep appears to be next out the door.
By some accounts, Diep is the most bipartisan-friendly member of the Assembly’s Republicans. Last year, he was the lone Republican to vote for a controversial bill — now a controversial law — that makes it harder for companies to classify workers as independent contractors.
He also vocally criticized President Trump and advocated for union-favored public contracts in Anaheim. All of that incurred the ire of conservative activists in Orange County who got behind the candidacy of Janet Nguyen, a former Republican state senator, running to Diep’s right.
Diep was already facing a well-resourced challenge from Diedre Nguyen, a Garden Grove City Council member.
While the early electoral results put Janet Nguyen and Diep in first and second place, Diedre Nguyen has overtaken Diep as more ballots have been tallied from Election Day mail voters and those who registered at the last minute. In California, the later ballots tend to be more Democrat-friendly.
Diep said it’s still too early to concede the race, but he doesn’t hold out much hope.
“Several days after Election night I didn’t think my modest lead would hold against Diedr(e) Nguyen so I don’t have any reason to believe the current placements will change,” he said in a text message Thursday.
Scott Baugh, a former Orange County GOP chairman who helped recruit Janet Nguyen into the race, bristles at the notion that Diep is being punished for moderation.
“Moderate is taking an in-between position,” he said. Diep “jumped with both feet into the deep end and joined the progressive Democrats on very, very liberal votes.”
In theory, California’s top-two election system was supposed to benefit politicians like Diep. Rather than require candidates to compete for the support of the most ideologically committed members of their own party, the system puts every candidate on the same ballot regardless of party, encouraging them to appeal to voters across the political spectrum.
At least, that’s the theory.
“The whole idea of the top-two was precisely to encourage the election of moderates, but what we’ve found is that people tend to stay in their own lanes,” said Pitney. “Increasingly, it’s just hard to get Democrats and (independent) voters to support a Republican in the first round.”
Since the top-two system was introduced statewide in California in 2012, not a single incumbent state lawmaker has failed to place first or second in the primary election. But this year, Diep, along with GOP Assemblyman Bill Brough, whose last term in office was mired in scandal, will be the first.
Baugh said he hopes Diep’s probable loss will send a clear message to other candidates and incumbents: “You can’t campaign and get elected as a conservative and then go to Sacramento and vote like a liberal.”
Republicans are receiving another message from the two state Senate races.
In Costa Mesa, Republican Sen. John Moorlach currently holds about 48% of the vote. His two Democratic challengers combined have raked in the rest. Those are worrisome numbers for any incumbent, but particularly a Republican. Because Democratic and Democratic-leaning voters tend to turn out for general elections in higher numbers, the total Republican share of the vote tends to shrink between the primary and November contests.
In Fullerton to the north, GOP state Sen. Ling Ling Chang is in first place in her re-election race, but with only about 48% of the tallied vote. The rest is split between the two Democrats.
Mike Madrid, a political consultant and frequent critic of the state GOP, said the Senate race results ought to signal to California Republicans that they need to broaden their ideological appeal.
Instead, he said, Diep’s loss suggests the party is eating its own.
“Republicans have developed this martyr complex, where they’d rather lose than evolve,” he said. “And in a situation like that, you’re going to lose!”
Predictably, Bough disagrees.
“There is always room for moderates in our party, but there is no room for people who betray our party,” he said. Even so, based on the election results so far, “Republicans need to work harder than they’ve ever worked to keep what they have.”
Will Vacant Homes >90 Days Become Illegal?
CalMatters
California has a housing shortage, so the idea of a big, faceless corporation keeping thousands of homes empty for months is pretty frustrating. But a new proposal in California is aimed at changing that by allowing cities and counties to impose vacancy fines.
The intent is to let local governments levy charges on corporate-owned homes left unoccupied for more than 90 days, as well as to use eminent domain — expropriation rights — to take possession of such homes to use as affordable housing. Existing law requires that properties be declared blighted before cities can confiscate them.
“In this type of crisis, when we have so many people either unhoused or in housing insecurity, there’s no justification for a residential unit to be vacant,” said state Sen. Nancy Skinner, the Berkeley Democrat behind the proposal. “(I’m) trying to make sure that every bit of residential property is being used for that purpose — to house people.”
According to 2018 census data, there are more than 1.2 million vacant homes in California, a number that includes homes owned individually and by corporations, apartments, vacation homes and dwellings for rent or sale. There’s no way of knowing how many would be subject to penalties. It’s also unclear how many owners would make vacant homes available rather than pay a fine, or how many people could be newly housed in those places.
Nor is it clear how much money would be generated by such charges to fund local housing programs, as Skinner’s measure would require.
No state law prohibits vacancy taxes, but Skinner wants to enshrine fines as an option along with expanded eminent-domain rights. The League of California Cities has not taken a position on the bill, which would apply to corporate-owned single-family homes, condos and completely empty apartment buildings.
Skinner’s proposal also includes right of first refusal for community land trusts and other nonprofit groups: Corporations would have to give them the first shot at purchasing the vacant homes. With foreclosed homes, tenants would have initial buying rights.
The first-refusal provisions evoke a situation in Oakland involving a group of homeless and housing-insecure mothers, Moms 4 Housing. Members occupied an abandoned home owned by corporate property-flipping giant Wedgewood Inc.as a protest against gentrification, displacement and a lack of affordable housing.
Moms 4 Housing was evicted in January. But in a last-minute deal yet to be finalized, the group would be allowed to move back in.
Wedgewood would sell the house to the nonprofit Oakland Community Land Trust and give the trust the first opportunity to buy any future homes the company sells in Oakland.
After the Great Recession, investment firms snapped up hundreds of thousands of foreclosed homes across the country and have come under fire in recent years for jacking up rents, imposing fees and neglecting maintenance. One of the most prolific corporate landlords is Invitation Homes, which owns and rents out almost 80,000 single-family dwellings.
In California, purchases by big investment firms have slowed in recent years as housing prices have skyrocketed. But these companies still own and rent out a lot of homes — nearly 25,000, according to data from the Anti-Eviction Mapping Project. Invitation Homes sits at the top of the heap with 13,563 for rent across the state.
How many corporate-owned houses are actually sitting vacant for more than 90 days? That’s not clear.
The Canadian city of Vancouver has a vacancy tax, with mixed results.
In response to a citywide housing crunch and skyrocketing housing costs, the west coast city imposed a yearly 1% vacancy tax in 2017 on any residential property — not just corporate-owned — that has been empty for at least 6 months. Two years later, the province of British Columbia, where Vancouver is located, imposed an additional half-percent for Canadian owners and permanent residents and 2% for foreign owners.
The results? The number of vacant homes dropped: Vancouver had 1,989 empty residences subject to the tax in 2018, a 22% drop from 2017 — but that’s only a slice of the total vacancies.
Both the city and the province have laundry lists of exemptions, including renovations, legal proceedings, hospitalizations and estate sales — to the point that the number of exempt vacant Vancouver homes was more than double the number taxed in 2018.
And Vancouver’s overall vacancy rate is pretty small anyway — around 1%, indicating an incredibly tight rental market. British Columbia’s is similar at 1.5% (California had a statewide vacancy rate of 8.44% in 2018). Even filling more vacant homes doesn’t necessarily mean rents become more affordable.
Still, there’s lots of new tax money for affordable-housing projects— Vancouver collected nearly $40 million Canadian dollars ($28.8 million U.S.) in 2018 and the province pulled in at least $115 million ($88 million U.S.) in 2019.
Vacancy fines “certainly don’t represent a silver bullet by any stretch,” said Josh Gordon, an assistant professor at Vancouver’s Simon Fraser University who studies the city’s housing market.
Targeting only corporate-owned homes, Gordon said, seems too narrow.
“The lesson from British Columbia is that the tax needs to be applied in a fairly broad manner, and enforcement has to be done diligently, and the penalties for leaving properties vacant have to be fairly substantial,” he said. “Short of that, you’re not going to get much movement in the rental market.”
Skinner’s bill doesn’t specify a penalty amount, but that could be added. The senator said she doesn’t expect her bill to be a cure-all, but everything helps in a crisis.
“Maybe we get 100,000 units that get back onto the market,” she said. “But when you look at the nature of our crisis, we can get 100,000 vacant units back into use far quicker than we can construct 100,000 units.”
Carroll Fife is the director of the Alliance of Californians for Community Empowerment Oakland, an advocacy organization that worked closely with Moms 4 Housing, and a supporter of Skinner’s bill as a “positive first step.”
“Corporations are not people, and they should not be allowed to buy up the housing stock,” Fife said. Skinner’s bill is “starting to course-correct where we’ve gone off track.”
But expanding a vacancy charge beyond corporate owners would be challenging, Fife said, because people have strong feelings about property rights, as they do about guns.
“It’s similar to the Second Amendment,” she said.
The eminent-domain provision of Skinner’s proposal may be the most controversial. Debra Carlton represents the California Apartment Association, a lobbying group for landlords. She said the eminent-domain element is “unconscionable.”
“I don’t think eminent domain was ever intended to be used in that way,” Carlton said. “That’s almost theft — taking somebody’s property … corporate owner, mom and pop, it doesn’t matter.”
But in a housing crisis, Fife said, there’s a need for bold solutions.
“I just wish that there was that same kind of fervor around eminent domain reclaiming black neighborhoods in service of business interests and municipal interests,” Fife said. “You don’t see that kind of opposition in West Oakland when the city comes and says, ‘We want to put a post office here’ or, ‘We’re gonna build a freeway through your neighborhood.’”
But as for the penalty itself? Carlton said it could be negotiated — her group would want a longer permissible vacancy period as well as exemptions similar to what Oakland has for its recently implemented vacant-land tax and Vancouver and British Columbia have for vacancies.
And first-refusal rights? “If there’s a tenant in the property, they would have the first right to purchase it.” Carlton said. “That makes sense. That’s fine.”
Others, however, see the whole bill as an attack. Wedgewood spokesperson Sam Singer called it an “economy killer” and “an assault on property owners in California.”
But he also said that the bill would have no effect on Wedgewood’s business model, as the company doesn’t keep homes vacant for more than 90 days.
“By the very nature of the house-flipping business, you buy it, you fix it, you sell it,” Singer said. “The redistribution of either corporate-owned homes or individually owned homes is a very dangerous path for California.”
Invitation Homes said it, too, would be unaffected. In an emailed statement, spokesperson Kristi DesJarlais said the company never keeps homes vacant, as that would “undermine our business model” and be “irresponsible given the housing shortage.”
DesJarlais said Invitation Homes’s California occupancy hovers around 97% and that the best solution to the state’s housing crisis is building more housing.
High occupancy is commendable, said Skinner.
“If their business model is to get homes occupied before 90 days, I say great; more power to them,” the lawmaker said. “And if they don’t, then my bill will affect them.”
New York Times
PHOENIX — Colin Jordan, a 32-year-old software salesman, lists various predictable reasons for his move to Scottsdale from the San Francisco Bay Area. He likes sun and golf and lower income taxes. But beneath all that is something bigger, which is the feeling that Arizona has welcomed him in ways that California — where he grew up — did not.
There are certain expectations you come into after graduating from college and getting a $90,000-a-year job, and one is that you won’t be paying $1,800 a month for a bedroom in a backyard cottage, which was what Mr. Jordan was doing in the Bay Area. He liked living near his childhood home and working at a tech company in the nation’s capital of innovation. But not if there was no path to what he considered a middle-class life.
“I knew for sure I’m never going to own a home,” he said. “So I talked to my girlfriend, and that was our defining moment. I said: ‘I want to buy a house and start a life. Will you move with me?’”
People like Mr. Jordan — now married and living in a four-bedroom house in Old Town Scottsdale — are a big factor in Arizona’s economic boom, a decade after it was hit hard by the recession. They are also part of a changing political identity that has given the once-solidly conservative state, now home to more than seven million people, a more purple-hued electorate.
On Tuesday, Arizona Democrats will help choose a nominee to face President Trump in the general election. The more significant test will come in November, when Arizona and its 11 electoral votes could tip Democratic for the first time since 1996. Its emergence as a swing state is a reflection of its changing economy.
With the coronavirus outbreak casting a shadow over economic prospects everywhere, it is hard to say what the near future will bring for Arizona. But it is clear how far it has come.
A decade ago, the state was grappling with foreclosures, bank failures and scores of empty subdivisions. Its unemployment rate peaked at 10.9 percent, about a percentage point higher than the nation’s. Today jobs have recovered, and the state is back to building seemingly every kind of development, from high-rise apartments and condominiums in the urban core to golf-course-adjacent ranch homes in the exurbs. (Mr. Jordan’s place, which he and his wife bought for $480,000, has a monthly mortgage payment only slightly higher than their rent in Redwood City. And it has a pool.)
From 2012 to 2018, an average of about 250,000 people per year migrated to Arizona from other states, with the largest contribution coming from California, according to an analysis of census data by Susan Weber for the demographic research site SocialExplorer.com. This is why it costs around $1,000 to rent a U-Haul truck heading from Orange County, Calif., to Phoenix, but only $100 to rent one to go the other way, according to John Burns Real Estate Consulting.
On the surface, adding new people and new subdivisions is the same thing the Arizona economy was doing as the real estate bubble inflated. But the nature of Arizona’s growth — and the kinds of workers it has attracted — has changed.
In the previous cycle, the economy consisted of “building homes for people who build homes,” said Scott Smith, a former homebuilder who served as the mayor of Mesa and is now chief executive of Valley Metro, the Phoenix region’s public transportation authority. The recent expansion, on the other hand, is marked by the growth of finance and technology companies that employ people like Mr. Jordan.
The number of finance jobs in the Phoenix area is up 25 percent since its pre-recession peak in early 2007, compared with 5 percent nationally, with companies like American Express and J.P. Morgan opening or expanding local offices, according to Moody’s Analytics. Technology companies have expanded their head count by about 30 percent in that time, while construction employment is still 24 percent lower than its peak before the recession.
“Our economy has been diversified like I have never seen in my three decades in business,” said Greg Vogel, chief executive of Land Advisors Organization, a land brokerage firm in Scottsdale.
If construction and subprime loans were symbolic of the state’s last boom, this time the image would be offices like WebPT, which makes software used by physical therapists and rehabilitation specialists to manage billing and medical information. Over the past decade the company has grown from a handful of people working out of subleased office space in coffee shops and architectural firms to a 500-person operation with headquarters in a downtown Phoenix industrial space that used to be a tortilla factory.
Inside there are the typical tech office touches like standing desks, Nerf guns, a commitment to dog-friendliness and conference rooms named after booze (margarita, gimlet, old fashioned, mojito). Heidi Jannenga, a co-founder of the company and its chief clinical officer, has a skateboard in her office and a nameplate that exhorts others to Do Epic Stuff, only it doesn’t say “stuff.”
“The ecosystem was nonexistent when we started,” she said of the environment for tech companies. “But we now we’re starting to have the density, which is really exciting.”
Despite its impressive job figures, Phoenix’s growth comes with a wrinkle, which is that the new tech and finance jobs are concentrated in positions that tend to pay less than is typical for these industries, noted Marc Korobkin, an economist with Moody’s Analytics. The average finance job in Phoenix pays about $77,000 a year, compared with about $110,000 nationally, according to Moody’s. The typical tech job pays $80,000 to $85,000, compared with $110,000 to $115,000 nationally.
Yelp, the business-directory and user-review site, is based in San Francisco but has moved hundreds of lower-paid sales and customer-service jobs to the Phoenix area. The company’s California and Arizona offices look similar — cramped cubicles, free candy — but where the San Francisco headquarters have an engineering-heavy work force and the cerebral quiet of headphone-equipped employees staring intently at computer screens, the 1,200-person Scottsdale operation reverberates with the din of sales representatives on phone calls while channeling their stress and ambition into imaginary baseball and golf swings.
The luxury of feeling relatively affluent is what Phoenix is selling to people as well as companies. A typical home in the Phoenix area is valued at about $293,000, below the national median of $306,000, according to Redfin, a national real estate brokerage. In addition to lots of flat and open land, a light regulatory environment makes it easier to build enough homes to meet demand. In the fourth quarter of 2019, builders in Phoenix were on a pace to build three times as many units — 14.6 per 10,000 residents — as the Los Angeles region, according to the Census Bureau.
The state has so much new housing, in so many different places, that it defies a particular type. In downtown Phoenix and in Tempe, home of Arizona State University, there are skyscrapers over light rail and a taste of the urbanist dream. About a mile from Arizona State along the light-rail tracks, Culdesac, a developer based in the Bay Area, is building a car-free development in a region known for sprawl.
At the same time, if you drive 40 miles west to an 8,800-acre planned community called Verrado, you see a more stereotypically Phoenix development. Verrado, which sits amid a rocky, shrub-covered landscape that is being steadily consumed by homes in various shades of tan, is in the town of Buckeye. Buckeye had about 7,000 people in 2000. Now it has 75,000 — along with new schools, new Starbucks cafes, new Taco Bells and homes in every stage of completion.
Unlike the dense living in Tempe, Verrado marks a revival of the exurbs that were hit hardest by the recession. The project’s developer started listing homes in 2004, and sold just over 500 that year. Then the housing boom collapsed, and it sold 87 in its worst year. But Verrado has steadily recovered, and in 2019 had its best year yet, with 602 homes sold.
While downtown-style living tends to attract young people with no children and old people with grown children, Verrado is a place for people in the thick of rearing children, people who think that “as much fun as it was to walk to get a beer, life has changed, and I want a backyard,” said Dan Kelly, the general manager.
With a growth rate second only to Nevada’s, Arizona is expanding its political clout and poised to become more Democratic. Newcomers arriving for cheaper housing and tech jobs are not the only cause of the shift but emblematic of it, said Ruy Teixeira, a senior fellow at the Center for American Progress, a liberal think tank.
The most recent example of the change is Kyrsten Sinema, the first Arizona Democrat elected to the Senate in 30 years, who won by 2.4 percentage points in 2018. (Hillary Clinton lost to Mr. Trump in the state by 3.5 points in 2016.)
“You have white noncollege voters being replaced by a significant white college-educated population,” Mr. Teixeira said. “There is a lower cost of living and relatively dynamic economy, so people are moving there because opportunities are good. And people growing up in the state are staying and becoming more educated. You put those things together and it favors a liberalizing trend.”
Purple is not blue, however. In her short time in the Senate, Ms. Sinema has carved out a reputation as a centrist whose more moderate positions have irked some Democratic colleagues. Then there is Mr. Jordan, the recent arrival from California.
He grew up as a Democrat, and like many Californians who move to Arizona, he initially felt strange in a place where people fly Trump flags and many stores post an open-carry firearm policy. But he also left home for a reason, and has come to wonder about the role of California’s liberal politics in creating the conditions that pushed him out. Now he describes himself as a moderate exhausted by the extreme ends of both parties.
“The gun thing is a little shocking, and I’m definitely a Democrat on social things like gay rights,” he said. “But when I go back to the Bay Area, I hear a lot about taxes and how San Francisco has become a war zone. And I don’t want to bring that with me.”
Dirtier Than A Toilet And It’s In Your Ear
Cell Phone Cleansing in the COVID Era
Wall Street Journal excerpt, no link
The world is on fire, but don’t you worry, I’m here to tell you how to clean your smartphone. That is, if you really want to clean your phone. Three people I spoke with over the past week said they did not clean their smartphones—and they’re all leading experts on microbiology and infectious disease.
WAIT! WHAT? I thought smartphones were dirtier than a toilet bowl. Heck, even academic studies, like this one from my favorite bedtime reading, the Journal of Hospital Infection, have found considerable amounts of bacteria, including fecal matter, on phone screens.
And yet all these experts said some variation of the same thing when I asked about combating coronavirus: thoroughly clean your hands; don’t touch your face; don’t worry about your phone.
Sure, except what if you’re one of those people where your smartphone is basically an extension of your hand? What if I touch a dirty subway pole, then touch my phone, then my phone touches my face? What if someone sneezes directly on my iPhone screen? What if I’m the kind of person who licks my phone? (Don’t judge.) A recent study found that, on surfaces such as metal, glass or plastic, coronavirus can survive for anywhere between two hours and nine days.
“It’s possible, theoretically, for this to live on a smartphone. If you had it out and someone sneezed or coughed on it and then you handled the phone, you could pick up infection that way,” says Daniel R. Kuritzkes, chief of the Division of Infectious Diseases at Brigham and Women’s Hospital. “People should keep their phones close to themselves. There is very little risk involved then.”
“My phone is the least of my concerns,” says Alex Berezow, a microbiologist and vice president at the American Council on Science and Health. “Worry about touching door handles that thousands of other people touch.”
After days of disinfecting my phone like a surgical tray, I was shocked. Phone cleaning is certainly not as cut and dried as you thought. After hours of research and scrubbing phones with everything from Cloroxwipes to Lysol toilet-bowl cleaner, I’ve come up with some basic lessons for what you can do—and not do—with that petri dish phone of yours.
Should I clean my smartphone?
Let’s be very clear: Even when there isn’t a pandemic sweeping the globe, your phone can get dirty.
Generally, that filth is not an issue, says Emma Hayhurst, a microbiologist at the University of South Wales and co-author on the aforementioned Journal of Hospital Infection paper. “We were trying to avoid mass panic about mucky phones. When you are healthy, it’s really not a problem.”
Translation: You should clean your phone—just not compulsively.
“We don’t need to be obsessively washing our phones right now. If people are coming into contact with coronavirus patients, then, yes. Wash your phone all the time. Not because there is evidence that it will transmit via a phone but because there is no evidence that it won’t,” says Dr. Hayhurst.
How should I clean my smartphone?
It’s long been the guidance of Apple, Samsung and other phone makers to just use a microfiber cloth to shine up your device.
All my new infectious-disease friends, however, say that to effectively kill the virus on a surface, you need disinfectant solution—for instance, something with at least 55% isopropyl alcohol.
On Monday, I reported that Apple updated its website to remove its blanket ban on all cleaning supplies. It now gives the OK to use a 70% isopropyl alcohol wipe or Clorox disinfecting wipe on the surface of all Apple products. Google also confirmed that it’s OK to use isopropyl alcohol or Clorox wipes to clean its Pixel devices.
After publication of this column, Samsung updated its cleaning guidance to include alcohol-based cleaners. It now advises Galaxy owners to dampen a cloth with a disinfectant or alcohol-based solution and wipe gently. It says not to apply liquid directly onto your phone.
Of course, the big question right now is, where do you BUY the wipes?
Can you use soap and water, as many have asked me? Sure, but avoid using rough paper towels or sponges on the screen. And never use bleach.
The big cleaning-solution fear cited by smartphone makers is damage to your phone screen’s oleophobic layer. This is a protective coating on your screen that repels both water and oil. Basically, it helps minimize fingerprints and smudges.
“Cleaning products and abrasive materials will diminish the coating and might scratch your iPhone,” Apple’s website reads. I took it upon myself to test that, as you’ll see in the video above. Using a brand-new iPhone 8, I wiped the screen 1,095 times with Clorox disinfecting wipes. I figured that’s the equivalent of wiping down your phone every day for the three years you might own it. The only thing showing any wear after all that wiping? My poor, wrinkly fingers. The coating still repelled drops of olive oil like it did when I first took it out of the box.
So I upped the effort. I was told that hydrochloric acid, found in toilet-bowl cleaner, would take it right off. Yet after five minutes of scrubbing, it was still fine. Soft Scrub with some bleach for five minutes? Still in decent shape. Finally, I decided to let it sit in a stew of toilet-bowl cleaner for two hours, then I threw in a five-minute rubdown with nail-polish remover, which has acetone. That did it…just about. (The phone, miraculously, still worked.)
Should you do any of that? Absolutely not, but these screens are far more resistant to these products than I’d thought. Plus, the oleophobic layer on your phone is going to wear from normal use anyway.
When cleaning with your disinfecting wipes, however, avoid getting liquid in the ports. Even if most phones are now water resistant, that resistance wears over time.