March 22, 2019 – News & Notes

For Clients & Friends of The Gualco Group, Inc.

IN THIS ISSUE – “I Did Not Just Listen. I Took Direction!”



  • California Adding Jobs Faster Than Houses



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




Mayors Convince Governor to Enhance Homeless Services

Gov. Gavin Newsom says the mayors of California’s largest cities have persuaded him to rework his budget proposal for emergency homelessness aid.

“We need to step up our game,” the governor of the state said after meeting with mayors of its 13 largest cities.

“We haven’t been doing enough to support cities,” he said. “And that means we need to invest more resources — and we need to provide the resourcefulness that is the spirit of innovation that drives this state.”

In fact, Newsom said the meeting was so “important” that he added, to the delight of the mayors: “The budget just changed.”

“I did not just listen,” he added. “I took notes. And I’m taking direction!”

The governor’s January budget proposal included $500 million to address homelessness — for programs that include shelters, resource centers, transitional housing and rental subsidies. That’s basically what former Gov. Jerry Brown approved in last year’s budget deal.

The mayors said that money didn’t last long.

“We had that check,” Los Angeles Mayor Eric Garcetti said. “It was an $85 million, $87 million check. I’ve never held a check that big, and I’m glad the state still sends checks — not a transfer. We spent that the next day, $6 million of that.”

Now, Garcetti said, Los Angeles has spent half of its funding, and has laid out exactly how it will use the other half.

This year, the mayors want $1.5 billion — three times Newsom’s January proposal.

They want more flexibility on when they can spend it, too.

“For those of us who are making our own capital expenditures to specifically build new structures or invest in new facilities, the idea that we would have a longer window in which we knew we had funding for services also can help us leverage this money in a much more effective and impactful way,” Oakland Mayor Libby Schaaf said.

And they want more money to bypass counties and go directly to big cities. Under last year’s budget deal, roughly a third of the $500 million went straight to cities. The rest is being distributed to counties through what are known as “continuum of care” programs that coordinate housing and services for homeless families and individuals.

The governor’s office declined to elaborate on how his budget has changed, saying only that he would take the mayors’ recommendations into consideration. But two people in the room said Newsom was open to the proposals.

Walking a fine line, the mayors acknowledged last year’s agreement with Brown but made clear they believed Newsom would be more forthcoming with state aid.

“Homelessness needs to be seen by the state — as well as all of the local governments and our communities — as the state of emergency that it is,” said Sacramento Mayor Darrell Steinberg, “and that the resources and the law changes need to be commensurate with that crisis.”


 Newsom’s $10 Water Tax Surfaces at Budget Hearing

Gov. Gavin Newsom wants to charge California water customers up to $10 per month to help clean up contaminated water in low-income and rural areas, but he will face resistance from some legislative Democrats hesitant to impose new taxes.

The Democratic governor says up to 1 million California residents have some type of contaminated or unclean water coming through their taps that can cause health issues. He has called it “a moral disgrace and a medical emergency.”

“The fact that in California, in the fifth-largest economy, we have people who cannot drink their water, people who can’t even bathe in their water, there’s something absolutely wrong,” Democratic Assemblywoman Eloise Reyes said Wednesday during a hearing on Newsom’s plan.

The fee on water customers would affect households and businesses — an idea that lawmakers killed last session. Newsom wants to combine it with fees on animal farmers, dairies and fertilizer sellers to raise about $140 million per year.

A competing proposal by Democratic Sen. Anna Caballero would use money from the state’s multibillion-dollar surplus to create a trust fund to pay for water improvements.

Newsom’s plan could be difficult to pass because tax and fee increases require support from two-thirds of lawmakers.

Democrats hold 75 percent of the legislative seats, but some who represent moderate or agricultural districts may balk at the proposal, particularly after voters recalled a Democratic senator last year after he voted to raise the gas tax. Caballero, for example, represents an agricultural district previously held by a Republican.

There was broad agreement at Wednesday’s hearing that the lack of access to clean water for so many is a stain on the state, but lawmakers acknowledged a political solution has been elusive.

“I would be foolish, based on the history of this issue, to make promises about where we’re going to end up at the end of this cycle,” said Assemblyman Richard Bloom, chairman of the budget subcommittee. “But I will commit to doing my damnedest to bring this to a conclusion.”

Newsom’s plan starting next year would charge water customers from 95 cents to $10 a month, based on the size of their water meter, with exceptions for people in poverty.

Animal farmers, dairies and fertilizer producers and handlers also would pay a fee because their operations contribute to nitrate in groundwater.

The money raised would help public water systems, including those that serve schools, treat contaminated water, improve long-term maintenance and test the water quality of domestic wells.


Is Governor “Kissing Off Voters”?

Commentary from the LA Times

Gov. Gavin Newsom has drawn heavy flak for kissing off the voters on capital punishment. He’s also ignoring promises made to voters when they supported a gas tax and vehicle fee increase.

This could be a dangerous trend for the new governor. If a powerful elected official were perceived as two-faced with his word and dismissive of the voters’ desires, he’d be headed for the political cliff.

The voters would become even more cynical and mistrustful of government, making it harder yet for politicians to gain public support for major projects and policy changes.

First, a revisit to the death penalty:

After Newsom declared a moratorium on capital punishment last week, I wrote that he deserved credit for having the guts to act on his convictions.

He still does. But he’s being legitimately criticized for snubbing the will of voters after they chose twice in recent years to retain capital punishment. They even voted in 2016 to expedite executions.

Moreover, Newsom previously promised to carry out capital punishment even if he opposed it.

Campaigning in 2016 for capital punishment repeal, the then-lieutenant governor told the Modesto Bee editorial board that if he were elected governor: “I would be accountable to the will of the voters. I would not [put] my personal opinions in the way of the public’s right to make a determination of where they want to take us as [it] relates to the death penalty.”

After Newsom did just the opposite last week, the Bee editorialized that “the governor’s lack of principle and failure to keep his promise is a slap in the face to survivors of heinous murders…. There is no excuse for governing by edict just because a leader doesn’t like what voters have said.”

Last year, when Newsom was running for governor, the San Francisco Chronicle reported that his campaign strategist, Dan Newman, said the Democratic candidate “recognizes that California voters have spoken on the issue and, if elected governor, he’d respect the will of the electorate by following and implementing the law.”

After declaring the moratorium, Newsom was questioned by reporters about breaking promises. He answered that the state Constitution gives him the right to do what he did.

“The will of the voters is also entrusted in me on the basis of my constitutional right to grant a reprieve” to murderers, he said.

But what about his promise?

“I’ve had to process this in a way that I didn’t frankly anticipate,” he said. “A few months ago, it was an abstract question…. [Now] this question is real … a question that goes deep to who I am.”

He is unequivocally a death penalty opponent. But he’d also better make sure he isn’t seen as a governor whose word isn’t worth squat.

Newsom was compared to President Trump on Wednesday by the Los Angeles County Assn. of Deputy District Attorneys.

“The [governor’s] assertion of executive authority is particularly ironic,” wrote association President Michele Hanisee, noting that California is leading a lawsuit against Trump’s declaration of a state of emergency on the U.S.-Mexico border.

“The argument presented in the lawsuit is that the president’s use of this executive authority usurps congressional authority…. How is this moratorium by the governor, which usurps the legislative authority of the voters to enact laws via ballot initiative, any different?”

Now about the gas tax: It took about four years for former Gov. Jerry Brown and Democratic lawmakers to enact legislation raising $5.2 billion annually for road repairs. Much political blood was spilled.

The bill increased the gas tax by 12 cents a gallon and imposed a new annual vehicle fee, ranging from $25 to $175. Out of the pot, 65% goes for road and bridge repairs and 20% for transit. The rest is earmarked for better truck access around ports and for bicycle and pedestrian lanes.

Republican opponents charged that in the past, transportation money had been diverted for other projects. There was a small germ of truth in that. So Democrats sponsored a successful, separate ballot measure guaranteeing that all the new tax money would be safeguarded in a transportation lockbox.

When gas tax opponents placed a repeal measure on last year’s ballot, tax advocates cited that lockbox protection in their official voters’ guide argument. It prevents “Sacramento politicians from raiding transportation funds,” they asserted.

Repeal opponents promised that every community would share in the new transportation funding bonanza. The repeal lost overwhelmingly.

Then Newsom took office and almost immediately proposed legislation to withhold gas tax funds from cities that weren’t doing enough to spur homebuilding — a non sequitur.

“If you’re not hitting your [housing] goals, I don’t know why you get the [transportation] money,” Newsom said. Huh?

After objections, Newsom said he’d delay the money withholding for four years.

“He’s trying to put out carrots and sticks” to prod housing, said Sen. Jim Beall (D-San Jose), chairman of the Senate Transportation Committee, who fought hard to pass the gas tax legislation. “I don’t describe that as either a carrot or a stick. I’d describe that as a nonstarter. I don’t see any [legislator] jumping up and down for it. Most think it’s a lousy idea.”

He added: “It would put a stink on votes for future [ballot measures] like bonds.”

Newsom should reread Article II, Section 1 of the California Constitution. It begins: “All political power is inherent in the people.”


California Adding Jobs Faster Than Houses

Wall Street Journal excerpt 3/19

California’s economy is adding jobs far faster than affordable places to live, forcing some employers to leave the state as they expand.

Companies that move from California have historically left behind its diverse industries, renowned public universities and balmy climate for states with lower taxes and lighter regulation. But now home prices and rents, higher on average than anywhere else in the country, have surged to the top of concerns for businesses and workers.

For employers, “we’re at a crisis stage,” said Rob Lapsley, president of the California Business Roundtable, an association of executives. Companies are struggling to recruit or promote from within as people turn down offers to come to California, Mr. Lapsley said. And with the types of jobs being taken out of the state, he added, “we’re not growing the strong middle class that we used to.”

Karen Holian, 44 years old, joined the startup when it was founded here in 2015. Though a San Francisco native, Ms. Holian, a marketing manager, was excited when the company last year moved to Austin, Texas, because she could finally plan to buy a home.

“In San Francisco, that never seemed like a possibility,” she said. A mother of two, she is for now renting a four-bedroom house for $2,000 a month, a third of what a comparable place costs in her hometown. CEO Tony DiMatteo said that as the company grew, he found it difficult to persuade current and prospective employees to move to the area. “We can give them a much better bang for their buck if we’re not in San Francisco,” he said.

The median home price in California in 2018 was $570,010, according to the California Association of Realtors, more than double the nationwide figure. The median price for a house in the Bay Area hovers around $1 million.

In addition to tech startups like, employers that have moved out of California or stopped adding jobs in the state in the past five years come from such industries as finance, manufacturing, biotech, and food and beverage. They include brokerage firm Charles Schwab & Co., which has focused expansion outside its San Francisco headquarters, and smoothie-maker Jamba Juice, founded in San Luis Obispo, Ca.

Core-Mark Holding Co. , which grew from a San Francisco tobacco shop in the 1800s to the second-largest distributor to convenience stores in the U.S., said last year it would relocate to a suburb of Fort Worth, Texas.

CEO Scott McPherson said recruiting new employees to the Bay Area became challenging given housing prices and long commutes.

McKesson Corp., the nation’s largest pharmaceutical distributor, in November said it would move its global headquarters from San Francisco to the Dallas suburb of Irving, Texas, bringing hundreds of jobs.

In the Bay Area, the tech industry’s historic home, even high-salaried engineers say they are looking to put down roots elsewhere because they can’t afford to rent or buy homes near their jobs.

Carl Guardino, chief executive of the Silicon Valley Leadership Group, said CEOs tell him “that any new job that doesn’t absolutely need to be in the Bay Area is located outside of the Bay Area.” The public-policy advisory group counts some 360 companies, including Silicon Valley’s largest, as members.

There is no government data on how many companies and jobs have left California.

An average of 80,000 homes were built each year in the past decade, far below the 180,000 homes needed year to keep up with population growth through 2025, according to state estimates.

Gov. Gavin Newsom’s chief business and economic adviser, Lenny Mendonca, says he regularly hears from employers that they can’t recruit people because housing costs too much, but “in terms of the absolute scale of employment and the number [of companies] that move every year, that is very small.”

California’s unemployment rate in January was 4.2%, slightly higher than the national rate. But more than half its renters, and over a third of mortgage-holding homeowners, spend more than 30% of their income on housing, the maximum experts consider affordable, according to the state housing department.

Mr. Mendonca said California was still creating more companies and jobs than its undersupply of housing can handle. Since taking office in January, Mr. Newsom, a Democrat, has focused on trying to coax local communities to build more affordable homes more quickly.

Texas has drawn more companies leaving California over the past decade than any other state, according to research by Joe Vranich, a relocation consultant who encourages businesses to leave California.

Housing costs are “a major selling point for us,” said Mike Rosa, senior vice president of economic development for the Dallas Regional Chamber. “It’s a factor in just about every [relocation] search we see.”

Tech companies searching for talent in other states have taken note.

Duolingo, a language-learning startup based in Pittsburgh, put up a billboard last year along a San Francisco freeway reading: “Own a home. Work in tech. Move to Pittsburgh.”

Lowell Reade, formerly a user-experience researcher at Facebook, was among Duolingo’s recruits. He took a job at the company last year and swapped his $2,300 per-month, 350 square-foot apartment in the city of Palo Alto, Ca., for a three-bedroom in Pittsburgh that rents for $1,800.

“It was becoming difficult to imagine a future that was appealing to me” in Silicon Valley, said Mr. Reade.

Duolingo put the billboard back up last week.


Western States Reach Colorado River Water Accord

Seven Western states have agreed on a plan to manage the Colorado River amid a 19-year drought, voluntarily cutting their water use to prevent the federal government from imposing a mandatory squeeze on the supply.

State water officials signed the deal on Tuesday after years of negotiations, forestalling what would have been the first federally enforced restrictions on the river’s lower basin. But any victory may be short-lived. Climate change promises to make the American West increasingly hot and dry, putting further pressure on the Colorado and the 40 million people who depend on its water.

“We all recognize we’re looking at a drier future,” said Tom Buschatzke, director of the Arizona Department of Water Resources.

The water in Lake Mead, the vast reservoir formed by the Hoover Dam that supplies the lower basin, has dropped to levels not seen since it began to fill in the 1960s. Lake Mead and Lake Powell, another reservoir on the river, are essential sources of water for Southern California and Arizona, and sit at less than 40 percent full.

By the beginning of March, the water level in Lake Mead had dropped to 1,088 feet above sea level. At 1,075 feet, under guidelines agreed to in 2007, the federal government would declare a shortage on the lower Colorado River, and mandatory water restrictions would go into effect.

Without sacrifices by the states — Colorado, New Mexico, Utah and Wyoming in the upper basin, and Arizona, California and Nevada in the lower basin — the reservoir could reach the trigger point next year, though recent heavy snowfall in the mountains that feed the river may help for a time.

Brenda W. Burman, commissioner of the Bureau of Reclamation, the federal agency that oversees the river, pressured states and their water agencies to make a deal. Without an agreement, she said, she would “take action to protect the river,” without specifying what that action would be.

In a conference call with reporters on Tuesday, she said she was “pleased to see their hard work is done.” The seven states and participating water districts sent a drought contingency plan to Congress, seeking legislation “for immediate implementation,” according to a statement from the bureau.

“It’s a hard-to-put-together puzzle, all about sharing some burdens,” said Sharon B. Megdal, director of the Water Resources Research Center at the University of Arizona. The plan builds on water conservation efforts that have, for example, kept Southern California water use relatively flat for decades despite a population boom.

The Imperial Irrigation District, California’s largest user of water from the river, threatened to derail the process when it demanded $200 million from the federal government to help restore the Salton Sea, the state’s largest lake. But other state water districts said they would cover Imperial’s share of water cuts without requiring that flows to the Salton Sea be reduced.

The Salton Sea is drying up in part because of measures taken by California farmers to use less water, which result in less runoff flowing into the lake. As it dries, fine dust from the lake bed blows into the air, which has been linked to childhood asthma and other illnesses.

Robert D. Schettler, a spokesman for the Imperial District, called the decision to move forward without its participation “unfortunate,” adding that a pact without the Imperial District “may mean getting it done, but not getting it right.”

The federal government regulates the water, but the states own the rights to it, said Jennifer Pitt, an expert on river issues with the Audubon Society. “So there’s a tension there,” she said. “The federal government’s consistent approach is to use that authority as a stick, but not ever go so far as to have to claim it.”

The river is important to the people who use its water, but also to “all of nature that depends on the river in the arid landscape of the Southwest,” Ms. Pitt said.

Another big risk is that Lake Mead could eventually drop below 950 feet, when water could no longer turn the dam’s turbines, or even 895 feet, when the lake would reach “deadpool” status and no water could flow out. That, said Patricia Aaron, a spokeswoman for the Bureau of Reclamation, need never happen. “That’s what the drought contingency planning on the river is about,” she said.

Brad Udall, a senior scientist at Colorado State University and an expert on water supplies in the West, told a congressional panel last month that the lower basin uses about 10.2 million acre-feet of water from the river each year, while upstream flows provide just nine million. (An acre-foot is the volume of one foot of water over one acre, about 325,000 gallons.)

Beyond that drain, climate change is bringing on a long-term crisis. “The Colorado River, and the entire Southwest, has shifted to a new hotter and drier climate, and, equally important, will continue to shift to a hotter and drier climate for several decades after we stop emitting greenhouse gases,” he said in his testimony.

In an interview, Mr. Udall said the influence of climate change was already apparent in the West. “Climate change is not some distant process,” he said. “It’s here, it’s now, it’s in our faces. It’s creating messes we have to deal with.”

Jonathan T. Overpeck, a climate scientist at the University of Michigan, said that politicians and policymakers needed to factor climate change into their plans. Lack of river water will lead people to pump more groundwater, which was deposited in the ice ages. “We’re using this fossil groundwater in unsustainable ways,” he said.

In a warming world, Dr. Overpeck said, less water in rivers and lakes is inevitable, whatever relief a wet season might bring. But for the most part, Western political leaders “don’t want to talk about it,” he said. “It is the disaster that’s over the horizon, if we don’t talk about it.


Electric Vehicle Impact Growing, But Behind Global Oil Demand

Electric vehicles are taking ever-bigger bites out of global oil demand, but they haven’t yet caught up with the growing size of the pie.

Gasoline and diesel displacement by electric vehicles will grow by 96,000 barrels a day this year, BloombergNEF said in a report. That brings the lost cumulative demand since 2011 at 352,000 barrels a day, about as much as total consumption by some countries, such as Peru or Portugal. By comparison, total global oil demand growth over the same period rose 12 million barrels a day to 100.6 million, according to the International Energy Agency.

Still, the volume of oil displaced this year is nearly 14 times higher than 2014, according BNEF. And about 2.7 million electric vehicles will be sold in 2019, increasing the number of such cars on the road by more than 50 percent, BNEF analysts David Doherty and Daisy Maugouber wrote in the report.

“The impact of passenger EVs and e-buses on global oil consumption is growing rapidly,” they wrote.

By 2040, electric vehicles could displace much as 6.4 million barrels a day of oil demand, while fuel efficiency improvements will erase another 7.5 million barrels a day, according to BloombergNEF’s May 2018 long-term EV outlook .

More than three-quarters of the displacement so far has come from electric buses, according to Tuesday’s report. About 500 barrels a day of diesel demand is displaced for every 1,000 electric buses on the road, about 30-times the rate for medium-sized battery electric cars. Most of the roughly 95,000 of such vehicles sold in 2018 were in China.

Morgan Stanley analysts earlier this month predicted that China’s oil demand would peak in 2025 as drivers forgo petroleum-fueled transport for battery-powered vehicles and high-speed rail.

By 2040, electric vehicles could displace much as 6.4 million barrels a day of oil demand, while fuel efficiency improvements will erase another 7.5 million barrels a day, according to BloombergNEF’s May 2018 long-term EV outlook .

More than three-quarters of the displacement so far has come from electric buses, according to Tuesday’s report. About 500 barrels a day of diesel demand is displaced for every 1,000 electric buses on the road, about 30-times the rate for medium-sized battery electric cars. Most of the roughly 95,000 of such vehicles sold in 2018 were in China.

Morgan Stanley analysts earlier this month predicted that China’s oil demand would peak in 2025 as drivers forgo petroleum-fueled transport for battery-powered vehicles and high-speed rail.


SF Shocker – Incentive for Electrifying Uber & Lyft

Environmental advocates want San Francisco to find ways to make electric vehicles more attractive to Uber and Lyft drivers at the same time they consider a per-ride tax on the companies that is meant to ease congestion.

In recent weeks, at least five organizations, including the Union of Concerned Scientists, Natural Resources Defense Council, Coalition for Clean Air and the San Francisco League of Conservation Voters, have sent letters to Mayor London Breed and the Board of Supervisors urging them to include tax breaks to push Uber and Lyft drivers toward zero-emission vehicles.

Led by Supervisor Aaron Peskin, city officials are fine-tuning the language of a ballot measure that would tax each Uber and Lyft ride that originates in San Francisco. It’s expected to appear on the Nov. 5 ballot and already has the support of the two ride-hail companies. The measure is expected to place a 3.25 percent tax on single rides and a 1.5 percent tax on shared rides. The San Francisco County Transportation Authority would receive the estimated $30 million in revenue to spend on local transit projects.

The environmental groups are advocating for some kind of tax treatment that would reward drivers who use electric vehicles, but exactly how that would work has not been outlined. Their goal is to have the city meet its goal of being a net-zero carbon emitter by 2050.

But questions remain about how to implement the tax break and how the city would install the charging stations needed if a significant portion of Uber’s and Lyft’s fleets shifted to electric vehicles. It’s not clear how many would be needed, but the city currently has just under 796 publicly available charging ports.

“The time for thinking and the time for studying and debate — we’re well past that. We need programs that help us electrify everything,” said Dan Jacobson, state director for Environment California, one of the organizations that wrote to city officials. “Electrifying the car-share rides should be a very low-hanging fruit program we can do here in the city, and one that should be adopted throughout the state.”

Much of the tax measure is predicated on a 2017 report from the county transportation authority that found that there were around 170,000 ride-hailing trips on a typical San Francisco weekday.

Peskin said he’s planning to add a temporary tax incentive for zero-emission vehicles into the ballot measure but emphasized that, at its core, the per-ride tax is intended to raise money for transit projects and reduce congestion attributable to Uber and Lyft.

“We want to incentivize zero-emission vehicles, but at the end of the day, we want to dis-incentivize congestion,” Peskin said. “We’re going to give zero-emission vehicles a running head start. We want to incentivize them so they’re encouraged to be part of the Uber and Lyft fleets, but that doesn’t mean they get a tax holiday forever.”

Peskin added that he hopes to put the measure on the November ballot with a unanimous vote of the board and the backing of the mayor.

“I’m all for it. Any way to incentivize people to go electric, I’m all for it,” said Esther de Frutos, who drives for Uber in San Francisco in her electric Chevy Bolt.

The ability to tax Uber and Lyft rides to fund transportation projects was cemented by 2018 legislation authored by Assemblyman Phil Ting, D-San Francisco. His bill, AB1184, included provisions that allowed city officials to create tax breaks for zero-emission vehicles, but didn’t mandate them.

“I’m a champion of clean cars,” Ting said. An enticement to move toward zero-emission vehicles, he said, was “something I’d encourage Supervisor Peskin to incorporate” into the ballot measure.

Another 2018 bill, from state Sen. Nancy Skinner, D-Berkeley, requires the California Air Resources Board and the California Public Utilities Commission to find ways to increase the number of electric vehicles in the ride-hailing fleets and reduce their greenhouse gas emissions per passenger mile.

Both Uber and Lyft have made some attempts to reward their drivers who use electric vehicles.

Davis White, Uber’s director of California public affairs, pointed to programs that give drivers a warning if an upcoming rider’s trip might take 30 minutes or more, a nod to the shorter distances most electric vehicles can cover before needing a charge.

In some cities, including San Francisco, Uber also gives small cash incentives to electric-vehicle drivers.

Last month, Lyft announced its intent to “introduce thousands of electric vehicles onto our platform,” and make it easier to request electric-vehicle rides. It’s not clear how far along the company is toward those goals, as a Lyft spokeswoman did not respond to a request for comment.

Neither environmentalists nor local policymakers have a firm sense of how the zero-emission tax break might actually work. Some have suggested making electric-vehicle rides available each time someone hails an Uber or Lyft ride, or allowing electric-vehicle drivers to keep more of the money from each fare.

Though he asked the mayor and the board for the electric-vehicle tax break, Jimmy O’Dea, a senior vehicles analyst with the Union of Concerned Scientists, said whatever is added to Peskin’s ballot measure probably won’t be “a strong enough incentive” to influence drivers’ decisions meaningfully.

“But at least it starts a bigger conversation that maybe wasn’t happening before,” he said. “It forces the city’s hand on the (charging station) question. If they portray to be supporting electric-vehicles, they have to go all the way and think about infrastructure as well, and not just a lower rate on the fees they collect.”


California Overgrown With Cannabis

California has too many marijuana farms — growing too much product — and if nothing is done it will devastate the industry, according to a 2019 cannabis harvest projection.

Vessel Logistics, a San Francisco-based cannabis distribution company, found that more than 1,142 acres of cannabis farms hold state permits. They can produce up to 9 million pounds of crop every year, but the permitted wholesale market can realistically support 1.8 million to 2.2 million pounds.

“Thus, even when a 50 percent cut in production is accounted for, a significant oversupply is unavoidable in 2019,” the report concluded.

California isn’t the only state to grapple with an overproduction of bud. A state audit found that Oregon growers are producing twice as much cannabis as the state market can support, and that there is “more than six year’s worth of supply sitting on shelves and farms,” according to Oregon Public Broadcasting.

“We’ll be in the same boat, but it will be more actual material,” said Daniel D’Ancona, president and founder of Vessel Logistics.

Until now, growers with a temporary license have relied on the black market to sell any product that couldn’t measure up to the state’s pesticide testing program or when there was a better price to be found, D’Ancona said. He said that all goes away as more growers are subject to the state’s Track-and-Trace program.

The program records “the inventory and movement of cannabis and cannabis products through the commercial cannabis supply chain — from cultivation to sale,” according to a state FAQ on the program.

Growers with a provisional or annual license are required to use Track-and-Trace. Temporary permit-holders are not. Instead, they are required to document all sales using paper invoices or shipping manifests.

“As soon as Track-and-Trace goes in place, it’ll be like trying to fit an elephant through a keyhole,” D’Ancona said.

The Vessel Logistics report concluded that because the cannabis industry in California has over-relied on both the black market and out-of-state sales, producers and manufacturers over-estimated the actual wholesale demand in the state.

“The impact will be felt across the entire supply side as permitted companies compete for a wholesale market that is a fraction of its pre-Track-and-Trace size,” the report found.

Over-production is just one of many hurdles that the cannabis industry faces in the Golden State.

Thousands of growers with a temporary license could soon be thrown onto the black market or forced to shut down unless the Legislature passes a law to push back the deadline for an extension application.

California also is a messy patchwork of legal statuses for cannabis cultivation and sales.

“The retail sector has been primarily restrained by city and county governments restricting retail and delivery businesses within their jurisdictions,” the report found.

The report recommends that cannabis cultivators create “strong relationships with processors and distributors,” that farmers partner with teams that have experience with the state’s Track-and-Trace program, and that farmers seek the advice of distributors “to gauge product demand before planting the wrong crop or over-planting.”

Or, as D’Ancona put it, “They need to grow less. …. If they grow like they’re used to growing … the products are going to be selling for less than the cost of production.”

So what do others in the industry think?

Jacqueline McGowan, a cannabis lobbyist with the firm K Street Consulting, says that while she is a self-confessed “doom-and-gloomer” about the cannabis industry in California, she would need more information about the Vessel Logistics report methodology before agreeing with the findings.

“Businesses without a product that consumers demand and without relationships with competent distribution partners will in fact be devastated, but the industry as a whole will be able to offer cheaper products to consumers, which is the best way to compete with the unregulated market,” McGowan said.

She added that other factors that have to be looked at are how much of the over-production will qualify for the licensed market, how much of that would pass the state’s strict pesticide policy and how many growers with temporary licenses (which are free) will go on to get provisional or annual licenses (which are not).

“Will this cause another ‘extinction event?’ Absolutely. But will it cause the industry to collapse? No it will not,” she said.


Dick Dale’s Surf Guitar Silenced

Nearly 60 years ago, surfers flocked to the waves along Newport Beach to try mastering the new craze. When the sun set, they needed someplace to dance and Dick Daledelivered it at Rendezvous Ballroom on the Balboa Peninsula. Nearly every week for two years, Dale and his band packed over 3,000 people into the ballroom.

“The energy between the Del-Tones and all those surfers stomping on the hardwood floor in their sandals was extremely intense. The tone of Dale’s guitar was bigger than any I had ever heard,” recalled Del-Tones bandmate Paul Johnson.

Dale, whose death was confirmed Sunday, manifested a quintessentially Southern California story, forged in surf, sand and rock ’n’ roll. They called him the Pied Piper of Balboa Beach, but his musical instrument of choice was defiantly not a flute. Rather, the electric-guitar playing son of a Lebanese father melded elements of the music of his ancestral homeland with roaring instrumental rock sounds emerging in the late-1950s, and helped pioneer an iconic American genre known as surf music.

“When I got that feeling from surfing,’” he told writer Barney Hoskyns, “‘the whitewater coming over my head was the high notes going dikidikidiki, and then the dungundungun on the bottom was the waves, and I started double-picking faster and faster, like a locomotive, to feel the power of the waves.”

Those rushing guitar lines energized generations across the Southland and reverberated around the world.

Dale, who was 81, died Saturday after a long bout with rectal cancer, longtime friend and former bassist Steve Soest said Sunday.

That guitar tone arrived via a blindingly fast picking technique, one of the centerpiece elements of his breakthrough hits “Let’s Go Trippin’” in 1961 and “Misirlou” the following year, that caused guitar picks to melt in his hand. A few decades later, director Quentin Tarantino tapped “Misirlou” to serve as the theme to “Pulp Fiction.”

The sound featured a liberal use of electronic reverb with his signature Fender Stratocaster guitar, cranked to wall-rattling volume through juiced-up Fender amplifiers. Other rock instrumentalists charted wordless hits before Dale came to the fore in the early days of the electric guitar, among them Link Wray’s “Rumble” and Duane Eddy’s “Rebel Rouser,” but Dale helped push surf music into the mainstream through those high-energy performances, supplying a sound that paired perfectly with that growing surf craze.

It began as a regional phenomenon in Southern California and soon spread around the world influencing the likes of the Beatles and Rolling Stones in England, and a high-school aged Canadian named Neil Young long before he found fame. According to Hoskyns’ “Waiting for the Sun,” a young Jimi Hendrix was said to have seen Dale and his band play. Echoes of Dale’s fiery guitar runs and showmanship can be heard in Hendrix’s style.

Dale was born Richard Anthony Monsour on May 4, 1937, in Boston to a father who had emigrated from Lebanon and a mother who was Polish Belarusian. Growing up in a Lebanese neighborhood in Quincy, Mass., outside of Boston, exposed him to the sounds of Arabic music, which became a signature of his musical amalgam.

His musical training started with his childhood interest in piano. Early on, he studied trumpet and also acquired a ukulele before eventually picking up a guitar and trying his best to emulate one of his heroes, country music titan Hank Williams. A friend suggested he call himself “Dick Dale,” rather than Richard Monsour, because it sounded more fitting for a would-be country singer.

The Monsour family moved to Southern California in 1954, when his father landed a job at Hughes Aircraft Co. in El Segundo, near the beach. Dale became a regular at the weekly live country music television show “Town Hall Party.”

“I wanted to be a cowboy singer, so I went on ‘Town Hall Party’ and entered their talent contest every week,” he told the Glendale News-Press in 2015. “And I did, every week.”

The confluence of Dale’s ethnic heritage and newfound geographic proximity to the beach and to the flourishing factory in Fullerton, Calif., where electric guitar innovator Leo Fender worked, all blended into the music Dale would soon bring to listeners.

“Misirlou” represented a cross-cultural blend, coupling minor key motifs and Middle Eastern musical scale with pounding drums and throbbing bass, all fueling Dale’s stinging “wet” electric guitar pyrotechnics. A section of the song featuring trumpet also brought in an element of the mariachi music that was prevalent around Southern California.

In interviews he would often overstate his role in the development of Fender products, but he was an important early adopter of instruments and amplifiers that would change the sound and content of popular music beginning in the 1950s. Dale liked to consider himself one of Fender’s favorite guinea pigs, and he did push guitars and amplifiers to the limits in his live performances.

“Playing guitar was only a window in my life,” he said in 2015. “I never practiced the guitar and when I’m done playing I just put it down. Music is like building a house. It’s like going out deep into the desert to see what nature is doing. It’s like painting, like Salvador Dali. I try to do that with my music, make it like a Salvador Dali painting.”

A freak accident — when hot oil exploded while he was cooking popcorn in 1983 left second-degree burns over much of his body — put him out of commission as a musician for months.

“With every problem comes a gift in hand,” he told The Times in 1985. “For instance, when I do shows to raise money for burn victims, now I can talk to them and know what they are going through. And I can tell their family and friends that when the doctor says the recovery has begun, that’s really the time they need your concern and love.”

As a celebrity, he capitalized on quirky passions. At one point he kept live tigers at his Balboa Peninsula mansion, which had previously belonged to Gillette shaving company magnate King Gillette, and titled an early-’80s live album “The Tigers Loose.” That was his first album in 18 years after surf music fell out of favor in the mid-1960s with the rise of the Beatles, the British Invasion, psychedelic music and other genres.

A decade ago Dale battled back from cancer, even playing a show in South Orange County shortly after being released from a nine-day stay at Cedars-Sinai Medical Center in Los Angeles for treatment of an infection.

“I thought, ‘I cannot cause this [club owner] to lose thousands of dollars,’” he said at the time.

That’s when he started trying to promote a new moniker to substitute for the “King of the Surf Guitar” label often applied to him: he wanted to be referred to as “Dick Dale-Cancer Warrior.”

With characteristic bravado, he told The Times, he would soon return to the hospital because “everything is messed up, and if it continues that way, I will die. But I’m not ready to leave my son, not ready to leave [his wife] Lana, I’m not ready to leave all the Dick Dale music lovers. They’ve been my medicine.”

Although he has not been inducted into the Rock and Roll Hall of Fame, he was elected to the Musicians Hall of Fame in Nashville a decade ago. He experienced recurring brushes with widespread popularity, notably in 1994 when Tarantino used “Misirlou” in “Pulp Fiction.”

In 2010, a career retrospective album “Guitar Legend: The Very Best of Dick Dale” also helped introduce his music to a new generation.

Through his life Dale practiced martial arts and explored Eastern philosophy, which he often quoted in interviews.

“There are four sentences [taken from Eastern philosophy] in my life that I go by: ‘To experience is to know. To know is to understand. To understand is to tolerate. To tolerate is to have peace’,” he told The Times in 1985. “It took me 17 years and [training with] masters of the martial arts to make me understand what that means. But I understand it and that’s how I can put up with all the stuff that goes on.

“That’s one of the reasons I like working with tigers and lions. If you can understand animals like that, then you can really put up with the reasons why people are the way they are and love them.”

Dale’s survivors include his wife, Lana, and his musician son, Jimmy. Information on services was not immediately available.

By | 2019-03-22T11:17:57-07:00 March 22nd, 2019|Air Quality|