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IN THIS ISSUE – “Nothing Close to Anything We’ve Ever Seen

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.

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FOR THE WEEK ENDING OCT. 23, 2020

 

California Economy Robust in 2nd Quarter…Thanks to Federal Assist

State Dept. of Finance

From July through September, California collected $8.7 billion more in tax revenue than anticipated, according to the state’s Department of Finance, a bright sign amid a year of devastating economic news.

The numbers reflect the positive effect of federal aid, which came in the form of one-time $1,200 checks for individuals and weekly $600 Pandemic Unemployment Assistance payments for people who lost jobs because of the coronavirus outbreak. They are also partly from taxes on 2019 income, when the economy was booming.

Additionally, the numbers are higher than expected in part because the pandemic has not hurt high wage earners particularly hard, many of whom have kept their jobs and continued to work from home. California’s budget relies heavily on the state’s highest earners because of the state’s progressive income taxes.

The Department of Finance has projected that the state would face an $8.7 billion deficit next fiscal year, even after making cuts to offset a $54 billion deficit this year. The better-that-expected revenue returns might mean a lower projected deficit in time for Gov. Gavin Newsom’s next budget proposal, which is due in January.

In the second quarter of 2020, California personal income increased by 9.7 percent on a year-over-year basis (up $254.4 billion) driven by record-high transfer payments of $355.8 billion, including the $600 per week in additional Federal unemployment assistance that expired at the end of July, support for independent contractors, regular unemployment insurance, and one-time stimulus checks.

All other major personal income components for California fell on a year-over-year basis in the second quarter of 2020, with a total decline of 4.4 percent (down $101.4 billion) led by decreases in total wages (down $59.5 billion), proprietors’ income (down $26.9 billion), and other components (down $15.0 billion).

U.S. personal income increased by 10.4 percent year-over-year in the second quarter of 2020 (up $1.9 trillion). Transfers also drove personal income growth, up a record-high $2.6 trillion. All other major U.S. personal income components also fell on a year-over-year basis.

JOBS

The U.S. unemployment rate fell from 8.4 percent in August to 7.9 percent in September 2020, 4.4 percentage points above the pre-pandemic level of 3.5 percent in February. The U.S. labor force decreased by 695,000 people in September following a 968,000-increase in August, with 4.4 million fewer Americans in the labor force than in February. The U.S. gained 661,000 jobs in September after 1.5 million jobs were added in August.

California’s unemployment rate decreased by 0.2 percentage point to 11.0 percent in September, down from a revised-down 11.2 percent in August and 7.1 percentage points higher than February’s pre-pandemic rate of 3.9 percent. California’s labor force grew by 19,000 people, with 839,000 fewer Californians in the labor force in September than in February.

The state gained 96,000 nonfarm payroll jobs in September, after adding a monthly average of around 225,000 jobs since May. Payroll jobs in September totaled 16.0 million, down 9.2 percent from February. In September, seven of California’s 11 major industries added jobs: leisure and hospitality (48,400), trade, transportation, and utilities (30,600), professional and business services (15,700), other services (10,900), construction (3,100), manufacturing (2,600), and information (200). Four industries lost jobs: government (14,600), financial activities (600), educational and health services (400), and mining and logging (200).

MONTHLY CASH REPORT

Preliminary General Fund agency cash receipts for the first three months of the fiscal year were $8.713 billion above the 2020-21 Budget Act forecast of $45.41 billion. Cash receipts for the month of September were $4.164 billion above the 2020-21 Budget Act forecast of $9.806 billion. Preliminary General Fund agency cash receipts for the entire 2019-20 fiscal year were $1.135 billion above the 2020-21 Budget Act forecast of $123.395 billion, or

0.9 percentage point above forecast. Total collections for March through September 2020 were down by 2.3 percent from the same period in 2019.

Personal income tax cash receipts to the General Fund for the first three months of the fiscal year were $6.667 billion above forecast. Cash receipts for September were $3.016 billion above the month’s forecast of $6.262 billion. Withholding cash receipts were $1.425 billion above the forecast of $4.225 billion. Other cash receipts were $1.676 billion above the forecast of $2.547 billion. Even though California does not have a September estimated payment due, taxpayers often match the federal estimated payment schedule. Refunds issued in September were $30 million above the expected $399 million. 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 September was $55 million higher than the forecast of $111 million.

Sales and use tax cash receipts for the first three months of the fiscal year were $1.641 billion above forecast. Cash receipts for September were $465 million above the month’s forecast of $1.719 billion. September represents the second prepayment for third quarter taxable sales.

Corporation tax cash receipts for the first three months of the fiscal year were $329 million above the forecast of $6.538 billion. Cash receipts for September were $504 million above the month’s forecast of $1.509 billion. Estimated payments were $507 million above the forecast of $1.262 billion, and other payments were $69 million higher than the $365 million forecast. Total refunds for the month were $72 million higher than the forecast of $119 million.

BUILDING ACTIVITY

California housing units authorized by building permits totaled 96,300 units in August (seasonally-adjusted annualized rate), down 16.7 percent from July and down 22.1 percent from February’s 123,700 units. August’s month-over-month drop was due to multi-family units down 32.3 percent to 36,400 units and a decrease in single- family units of 3.1 percent to 59,900 units. Year-to-date, authorized residential housing units averaged 96,000 (down 11.1 percent from the same period in 2019), split into 52,800 single-family units (down 4.2 percent) and 43,200 multi-family units (down 18.3 percent). California’s nonresidential building valuation in August was $21.9 billion, down 21.0 percent from July 2020 and down 19.2 percent from February’s $27.2-billion valuation. Year-to- date, nonresidential building valuation averaged $23.5 billion, down 31.7 percent from the same period in 2019.

REAL ESTATE

The existing single-family median home sales price in California set a new record for the fourth consecutive month, reaching $712,430 in September. The median home sales price is now up 22.9 percent from the pre-pandemic price in February 2020 and up 17.6 percent from September 2019. Statewide sales volume rose by 5.2 percent month-over-month to 489,590 units—the highest sales volume since 498,580 units in February 2009 during the Great Recession and 16.1 percent higher than the pre-pandemic level of 421,670 units in February 2020.

http://dof.ca.gov/Forecasting/Economics/Economic_and_Revenue_Updates/documents/2020/Oct-20.pdf

 

Legislative Elections Appear Status Quo

Politico

Republicans are trying to hold the line. Democrats are keeping one eye on expanding the map and another on protecting their members from intraparty challenges. Interest groups are spreading cash across the landscape, seeking to shape the partisan breakdown of Sacramento and ensure that their preferred type of Democrat wins.

Don’t count on 2020 being the year Republicans break the Democratic supermajority. Even with the GOP guaranteed to pick up a seat after two Republicans advanced in the open 38th Assembly District, the party would have to pick up multiple seats in each house to deprive Democrats of their two-thirds margins. That’s unlikely with anti-Trump animosity expected to drive liberal turnout.

Instead, the California Republican Party is largely playing defense on a half-dozen Assembly and state Senate seats. There are some endangered incumbents who failed to muster a majority of primary votes, like senators Ling Ling Chang and John Moorlach ; some GOP incumbents who fared better but have to surmount massive Democratic spending, like Assemblymembers Steven Choi and Phillip Chen; and an open seat the GOP is determined to keep in SD-23. Party money and outside spending by business, labor and law enforcement have flooded in.

Here are the races to watch:

THE PARTISAN CLASHES
Assembly District 55: Assemblyman Phillip Chen v. Andrew Rodriguez

GOP incumbent Chen outpolled Democrat Rodriguez by a comfortable 12.4-point margin in the primary, but Democrats’ 1.3-point registration edge has the party motivated to claim another seat — the California Democratic Party has channeled more than $770,000 to Rodriguez. A business-and-labor-funded PAC and the dental lobby are spending money to keep Chen in Sacramento.

Assembly District 68: Assemblyman Steven Choi v. Melissa Fox

Incumbent Republican Choi is one of the top recipients of California Republican Party money this cycle, indicating the state GOP sees shoring up this seat as a priority. Choi and another Republican combined for 53.3 percent of the vote in the primary, and the district’s registration numbers narrowly favor Republicans. But Democrats clearly see this as a winnable seat, with the party spending more than $1.1 million to back Fox; business and real estate groups are countering by spending hundreds of thousands of dollars for Choi and against Fox.

Senate District 29: Sen. Ling Ling Chang v. Josh Newman

This rematch gives Democrats the chance to avenge a defeat while testing their strength in Orange County. In 2018, voters recalled then-Sen. Newman, a Democrat, and replaced him with Republican Chang after Newman voted for a gas tax increase. Republicans have celebrated that win as a rejection of Democratic rule, but their celebration could be cut short. Chang fell short of a majority in the primary, scratching out 47.4 percent while Newman and another Democrat split the rest, and Democrats have a 7.5-point registration edge in the district; the party has given him more than $1.2 million.

Senate District 37: Sen. John Moorlach v. Dave Min

Another Orange County faceoff in former Republican country. As with Chang, the Republican incumbent Moorlach was unable to secure a majority in the primary. The district is almost evenly split between registered Republicans and Democrats, so much of this could come down to which party’s voters turn out and the decisions of no-party-preference voters who comprise a quarter of the electorate. And while business groups have spent money for Moorlach, the big outside bucks have broken for Min: the labor-backed Opportunity PAC has backed Min while California Correctional Peace Officers Association has poured more than $1.2 million into thwarting Moorlach.

Assembly District 72: Janet Nguyen v. Diedre Nguyen

Former state Sen. Janet Nguyen rejoined the political fray in the primary to take out Assemblyman Tyler Diep, a fellow Republican whose labor-friendly stances infuriated Orange County conservatives. This remains a conservative-leaning district — Republicans have a 1.7 point registration edge, and Diep and Janet Nguyen combined for almost 60 percent of primary votes — but Democrats see a pickup opportunity in Garden Grove City Councilmember Diedre Thu-Ha Nguyen, who has gotten more than $1.2 million from the California Democratic Party.

Senate District 23: Rosilicie Ochoa Bogh v. Abigail Medina

Split between San Bernardino and Riverside counties, this district has steadily trended Democratic in recent cycles, going from a 2.6-point Republican advantage in 2016 to a 1.5-point Democratic edge this time around. Republican school board member Ochoa Bogh and other Republicans combined for about 55 percent of the vote in the primary in a positive sign for the California Republican Party, and she’s gotten help from business and law enforcement groups in the general while oil companies blast away at Medina. But Democrats are pushing: Party committees have channeled hundreds of thousands of dollars to Medina, incumbent Senate Democrats have kicked in tens of thousands more and labor is spending on her behalf.

Senate District 21: Sen. Scott Wilk v. Kipp Mueller

Incumbent Republican Sen. Wilk represents a district where Democrats wield an 8-point registration edge, and Wilk’s voting record reflects that: He periodically votes with Democrats and has been the rare Republican to get labor support. But Democrat Mueller has launched a fierce challenge, and Wilk supporters are not getting complacent despite the incumbent securing a comfortable 53 percent in the primary: outside money has flowed heavily in this race, with the oil industry,business groups and a labor-business alliance spending more than $1.7 million for Wilk or against Mueller in the general.

Assembly District 42: Assemblyman Chad Mayes v. Andrew Kotyuk

Assemblyman Mayes immediately drew a party-backed GOP challenger after Mayes became an independent last year, and San Jacinto Councilman Kotyuk is drawing conservative support. Party money for Kotyuk has largely dried up in the general, although House Minority Leader Kevin McCarthy appeared at a virtual rally for Koytuk this month. Meanwhile, Mayes’ Sacramento tenure has helped secure heavy financial backing from business, agricultural and health care interests.

Assembly District 35: Assemblyman Jordan Cunningham v. Dawn Addis

While GOP Assemblyman Cunningham secured a comfortable 13-point primary win despite Democrats’ 3-point advantage in his district, the Templeton Republican remains a top target. Democrats have poured money into Addis’ campaign, including more than $500,000 from the state party, as business groups have spent hundreds of thousands of dollars to buoy Cunningham and rebuff Addis. Earlier this year, Cunningham was a leading voice among dissenting public officials urging Newsom to let local governments reopen the economy.

Missing the cut (but worth watching): A handful of Democratic incumbents look to be in good shape, based on comfortable primary wins and majority-Democratic districts, but they’re still getting ample party help. That includes perennial swing-seater Assemblywoman Sabrina Cervantes, recent seat-flippers Assemblywomen Cottie Petrie-Norris and Tasha Boerner-Horvath, and Republican-to-Democrat Assemblyman Brian Maienschein.

THE DEM-ON-DEMS:
Senate District 11: Sen. Scott Wiener v. Jackie Fielder

Incumbent Sen. Wiener would represent the far-left option in most districts, but San Francisco is not most districts. Wiener is fending off a challenge from progressive activist Fielder, who has hammered Wiener over real estate industry support — a reflection of Wiener’s preeminent focus on building more housing. The California Democratic Party and LGBTQ groups are spending to protect Wiener, who is openly gay. Fielder has drawn endorsements from local labor groups as well as outside money from the Federated Indians of Graton Rancheria; Fielder is Native American.

Assembly District 59: Assemblyman Reggie Jones-Sawyer v. Efren Martinez

Red lights went off when Assemblyman Jones-Sawyer finished in second place by several points in the primary. The district’s rapidly growing Latino electorate may have buoyed challenger Martinez. As the California Democratic Party and Assembly members have channeled well over $1 million toward defending Jones-Sawyer, law enforcement groups have spotted an opening and poured money into pro-Martinez mailers. That effort turned ugly when the California Correctional Peace Officers Association posted a video with a target over Jones-Sawyer’s face; CCPOA subsequently removed the spot. Education change group EdVoice is also backing Martinez, while Jones-Sawyer has gotten support from a network of PACs funded by both business and labor groups.

Senate District 15: Ann Ravel v. David Cortese

Business and labor groups have chosen sides in this contest between former campaign finance watchdog Ravel, a veteran of both the Federal Election Commission and the California Fair Political Practices Commission, and Santa Clara County Supervisor Cortese. Labor interests backed Cortese in the primary and have continued to do so in the general, with the union-funded Opportunity PAC spending for Cortese and against Ravel. The real estate industry and has also heavily backed Cortese. Oil companies and other business interests had supported Democrat Nora Campos in the primary, but now Ravel has drawn heavy support from the California Chamber of Commerce.

Assembly District 13: Carlos Villapudua v. Kathy Miller

Villapudua, a former San Joaquin County supervisor, was the top vote-getter as three Democrats split the primary vote in this safe Democratic district being vacated by Susan Eggman, a favorite to move to the state Senate. Miller, a current San Joaquin County supervisor, squeaked into second place by a mere 30 votes in March. Oil interests spent heavily on Villapudua’s behalf ahead of the primary and have continued to pour in money, including more than $1 million to vault him to victory.

https://www.politico.com/states/california/story/2020/10/20/here-are-californias-biggest-state-legislative-battles-1322150?campaign_id=49&emc=edit_ca_20201021&instance_id=23337&nl=california-today&regi_id=80823166&segment_id=41734&te=1&user_id=ebedd9f525ae3910eeb31de6bb6c4da0

 

Ballot Proposition Campaigns Set Spending Record

CalMatters

Never has an election cycle seen so much money funneled into California’s ballot measure campaigns — and there are still two weeks to go until the November election.

Already, the campaigns for and against the 12 propositions on the November ballot have raised a staggering $670 million, according to a CalMatters analysis. When added to the funds raised for a proposition voters struck down in California’s March primary, that number tops $684 million — dwarfing the $473 million raised during the 2016 election cycle, California’s previous record.

Darry Sragow, publisher of the California Target Book, which tracks campaign finance data: “There has been a steady increase in the total amount of money raised for ballot measure campaigns since 2014. But the astronomical spending this year is something we just haven’t seen before.”

In addition, the campaigns battling over four of the 12 propositions have raised nine-figure sums. Prop. 22, the most expensive ballot campaign in California history, clocks in at $206 million, followed by Prop. 21 and Prop. 15 at about $117 million each and Prop. 23 at $112 million.

But spending is rarely split evenly between the supporting and opposing campaigns:

  • 22: Most money spent by a supporting campaign.Uber, Lyft and Doordash have plowed $190 million into a campaign to exempt themselves from a new state labor law. The unions in opposition have raised $16 million.
  • 23: Most money spent by an opposing campaign.DaVita and other private dialysis clinics have raised $105 million opposing stricter clinic regulations, while unions supporting the measure have raised $7 million.
  • 15: A pretty equal split.Unions and the Chan Zuckerberg Initiative have raised $57 million supporting a tax hike on some commercial properties, while business groups have raised $60 million opposing it.
  • 21: A single-handed effort.The AIDS Healthcare Foundation contributed almost all of the $40 million in support of stronger rent control, compared to $77 million raised by a diverse coalition of opposition groups.

 

“Nothing Close to Anything We’ve Ever Seen”: Voters Already Voting

CalMatters

Roughly one-fifth of the 21.5 million ballots mailed to registered voters had been processed as of Tuesday evening, blowing away previous election totals.

About three times as many California residents have participated in early voting so far this year compared to the same period in the 2016 presidential election, according to Paul Mitchell, Vice President of Political Data, Inc.

The pace of returns has been extraordinary, Mitchell said. “It’s nothing close to anything we’ve ever seen.”

While there’s no clear-cut reason for the increase, experts have their theories. Mindy Romero, director of the Center for Inclusive Democracy at USC, said she sees three reasons why California’s early turnout is so high: voter enthusiasm, ballot and personal safety concerns, and a sense of relief.

“A lot of the voters, I think, are excited or nervous about the election and want to know that their vote is in,” Romero said.

Still, the unprecedented early voting doesn’t necessarily mean an increase in turnout, Mitchell noted, though he’s optimistic that might end up being the case.

“It doesn’t look like it’s, definitively, a surge electorate, where we have more young people, Latinos and low socioeconomic voters participating,” he said. “Just because somebody votes early doesn’t mean their vote counts for more.”

High-propensity voters—that is, voters generally expected to turn out in an election—have made up the overwhelming majority of the electorate so far. Late last week, about 99 percent of ballots returned were from those voters, who tend to skew older and whiter, according to Mitchell.

Mitchell predicts that relatively more low-propensity voters will cast their ballots in the coming days, boosting the final tally.

https://calmatters.org/politics/votebeat/2020/10/early-voter-turnout-california-record/

 

Air Board Chair Tops Biden’s US EPA List

Bloomberg

If Joe Biden wins the presidency, his EPA chief could be a clean air champion from California who has fought President Donald Trump on automobile pollution or an environmental justice activist from Mississippi.

Biden’s campaign has heard recommendations for both California air regulator Mary Nichols and Mississippi’s Heather McTeer Toney to lead the Environmental Protection Agency, among others, according to people familiar with the matter who asked not to be named revealing personnel discussions.

https://news.bloomberglaw.com/environment-and-energy/trump-california-nemesis-nichols-on-short-list-to-run-biden-epa

 

Trump Regulators Accelerate Environmental Rule Changes

NY Times

WASHINGTON — Facing the prospect that President Trump could lose his re-election bid, his cabinet is scrambling to enact regulatory changes affecting millions of Americans in a blitz so rushed it may leave some changes vulnerable to court challenges.

The effort is evident in a broad range of federal agencies and encompasses proposals like easing limits on how many hours some truckers can spend behind the wheel, giving the government more freedom to collect biometric data and setting federal standards for when workers can be classified as independent contractors rather than employees.

In the bid to lock in new rules before Jan. 20, Mr. Trump’s team is limiting or sidestepping requirements for public comment on some of the changes and swatting aside critics who say the administration has failed to carry out sufficiently rigorous analysis.

Some cases, like a new rule to allow railroads to move highly flammable liquefied natural gas on freight trains, have led to warnings of public safety threats.

Every administration pushes to complete as much of its agenda as possible when a president’s term is coming to an end, seeking not just to secure its own legacy but also to tie the hands of any successor who tries to undo its work.

But as Mr. Trump completes four years marked by an extensive deregulatory push, the administration’s accelerated effort to put a further stamp on federal rules is drawing questions even from some former top officials who served under Republican presidents.

“Two main hallmarks of a good regulation is sound analysis to support the alternatives chosen and extensive public comment to get broader opinion,” said Susan E. Dudley, who served as the top White House regulatory official during the George W. Bush administration. “It is a concern if you are bypassing both of those.”

Administration officials said they were simply completing work on issues they have targeted since Mr. Trump took office in 2017 promising to curtail the reach of federal regulation.

“President Trump has worked quickly from the beginning of his term to grow the economy by removing the mountain of Obama-Biden job-killing regulations,” Russell Vought, the director of the White House Office of Management and Budget, which oversees regulatory policy, said in a statement.

If Democrats take control of Congress, they will have the power to reconsider some of these last-minute regulations, through a law last used at the start of Mr. Trump’s tenure by Republicans to repeal certain rules enacted at the end of the Obama administration.

But the Trump administration is also working to fill key vacancies on scientific advisory boards with members who will hold their seats far into the next presidential term, committees that play an important role in shaping federal rule making.

Few of the planned shifts have drawn more scrutiny and criticism than a Labor Department proposal to set federal standards for defining when a worker is an independent contractor or an employee, a step that could affect millions of workers.

The issue has come to a boil as states like California have tried to push companies like Uber and Lyft to classify workers as employees, meaning they would be entitled to benefits such as overtime pay and potentially health insurance, a move that the companies have challenged.

The proposed Labor Department rule creates a so-called economic reality test, such as whether workers set their own schedules or can earn more money by hiring helpers or acquiring new equipment.

The department, in the proposed rule, said it cannot predict how many workers may see their status change as a result of the new definitions because of “uncertainties regarding magnitude and other factors.”

But it is nonetheless pushing to have the rule finished before the end of Mr. Trump’s first term, limiting the period of public comment to 30 days, half the amount of time that agencies are supposed to offer.

That has generated letters of protest from Senate Democrats and 22 state attorneys general.

“Workers across the country deserve a chance to fully examine and properly respond to these potentially radical changes,” said a letter organized by Senator Patty Murray, Democrat of Washington, and signed by 16 other Democratic senators.

The Departments of Labor and Homeland Security are using a tactic known as an interim final rule, more typically reserved for emergencies, to skip the public comment period entirely and to immediately enact two regulations that put much tougher restrictions on work visas for immigrants with special skills. The rule change is part of the administration’s longstanding goal of limiting immigration.

The Homeland Security Department is also moving, again with an unusually short 30-day comment period, to adopt a rule that will allow it to collect much more extensive biometric data from individuals applying for citizenship, including voice, iris and facial recognition scans, instead of just the traditional fingerprint scan. The measure, which the agency said was needed to curb fraud, would also allow it for the first time to collect DNA or DNA test results to verify a relationship between an application for citizenship and someone already in the United States.

third proposed new Homeland Security rule would require sponsors of immigrants to do more to prove they have the financial means to support the individual they are backing, including three years’ worth of credit reports, credit scores, income tax returns and bank records. Anyone who accepted welfare benefits during the previous three years would be unable to sponsor an immigrant unless a second person agrees to do so.

The agency is limiting public comment on that change to 30 days as well.

Unlike most of the efforts the administration has pushed, the rules intended to tighten immigration standards would expand federal regulations, instead of narrowing them. They also come at a considerable cost, estimated to be more than $6 billion just for the new demands related to immigrants’ biometric data and proof of financial capacity for those sponsoring immigrants.

The Environmental Protection Agency, which since the start of the Trump administration has been moving at a high speed to rewrite federal regulations, is expected to complete work in the weeks that remain in Mr. Trump’s term on two of the nation’s most important air pollution rules: standards that regulate particulates and ozone that is formed based on emissions from power plants, car exhaust and other sources.

These two pollutants are blamed for bronchitis, asthma, lung cancer and other ailments, causing an estimated 7,140 premature deaths a year in the United States, according to one recent study. The agency is proposing to keep these standards at their current levels, provoking protests from certain health experts and environmentalists who argue that the agency is obligated to lower the limits after new evidence emerged about the harm the pollutants cause.

Scott Pruitt, who served as the E.P.A. administrator in the first 17 months of Mr. Trump’s tenure, set as a goal before he left office to get these new standards adopted by December 2020, even though the agency had previously expected they would not be finished until 2022.

The agency also is rushing to complete a series of regulations that will almost certainly make it harder for future administrations to tighten air pollution and other environmental standards, including a limit on how science is used in rule making and a change to the way costs and benefits are evaluated to justify new rules.

Mr. Trump has played a direct role in pushing to accelerate some regulations. Among them is a provision finished this summer, nicknamed “bomb trains” by its critics, that allows railroads to move highly flammable loads of liquefied natural gas on freight trains. Mr. Trump signed an executive order last year directing the Transportation Department to enact the rule within 13 months — even before it had been formally proposed.

The change was backed by the railroad and natural gas industry, which has donated millions of dollars to Mr. Trump, after construction of pipelines had been blocked or slowed after protests by environmentalists.

But the proposal provoked an intense backlash from a diverse array of prominent public safety officials. Among them were groups representing thousands of mayors, firefighters and fire marshals nationwide and even the federal government’s own National Transportation Safety Board, which investigates fatal transportation accidents.

The gas is stored in 30,000-gallon rail tanks at minus 260 degrees to keep it compressed. But if accidentally released during an accident, it would rapidly expand by nearly 600 times as the temperature rises and cause what is known as a “boiling liquid expanding vapor explosion” that if ignited could not be quickly extinguished, potentially resulting in widespread injury or death if it occurs in a populated area, the firefighters warned.

“It is nearly certain any accident involving a train consisting of multiple rail cars loaded with L.N.G. will place vast numbers of the public at risk while fully depleting all local emergency response forces,” Harold A. Schaitberger, the president of the International Association of Fire Fighters, wrote in a letter opposing the proposal.

The Transportation Department still adopted the rule and rejected proposed speed limits for the trains, generating a petition for a court review by 14 states and the District of Columbia.

“Studies on how to safely transport liquefied natural gas by rail are still ongoing, and this administration has rushed to implement a rule that will needlessly endanger people’s lives and threaten our environment,” Michigan’s attorney general, Dana Nessel, said.

Even while the challenge is underway, the Transportation Department has moved to enact another rule easing safety standards, in this case removing a requirement intended to limit the number of hours truck drivers are allowed behind the wheel and to mandate rest periods.

Certain drivers who carry agricultural products would now be exempt from this federal mandate in a standard that would again be adopted as an “interim final rule,” meaning it would be put in place before any public comment is accepted, under the plan announced by the agency.

https://www.nytimes.com/2020/10/16/us/politics/regulatory-rush-federal-agencies-trump.html

 

Remote Working Update: Zoom Hits a Nerve

National Public Radio

Lately, Zoom meetings have been hitting a nerve with CEOs.

JPMorgan Chase CEO Jamie Dimon says there’s no vital “creative combustion”happening in virtual settings.

American Airlines CEO Doug Parker finds Zoom meetings awful.

And Microsoft CEO Satya Nadella calls them transactional, where “30 minutes into your first video meeting in the morning … you’re fatigued.”

Early during the pandemic lockdowns, in April, many were touting the benefits. James Gorman, CEO of Morgan Stanley, said his bank would need much less real estate in the future because even though he was a fan of having teams together, “we’ve proven we can operate with no footprint.”

Now members of the C-suite have gone full boomerang on Zoom meetings. After finding them awesome and productive at first, they’re now questioning how much they really achieve and are suggesting they lead to a sterile work culture lacking in imagination.

“What we as human beings need, want, seek … is human contact,” Nadella says. He was speaking at a virtual conference organized by The Wall Street Journal last week.

Dimon is particularly worried about how working from home has affected JPMorgan’s younger employees. He told analysts that productivity had dipped, especially on Mondays and Fridays. Dimon says bringing people back to the office is paramount to fostering creativity.

The bloom is clearly off this rose.

What Dimon and Nadella are articulating is increasingly bearing out in broader surveys. Architect and design firm Vocon, which of course has an interest in people returning to office spaces, conducted a survey in September. It found that 40% of people who ran businesses have noticed decreases in productivity from remote working staff. Among the same group back in April, 56% rated productivity as “excellent.”

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As for the employees, who sit in front of a computer every day in the same spot of their homes, often on video chat, they found the experience “draining.” They missed being able to connect face to face with colleagues and had trouble setting boundaries for when work started or ended.

“It was surprising to see so many people felt this remote work fatigue, especially given the headlines of 100% remote forever,” says Sarah McCann​, a real estate strategy associate at Vocon.

Another survey by virtual tech firm Lucid found that workers didn’t feel like they needed to behave during virtual meetings when no one was looking. Most of them admitted to “questionable behavior” during virtual brainstorm meetings, including 1 in 10 who admitted using the bathroom while on a call.

Some workers also admitted to exercising, taking a shower, watching TV and cooking or preparing a meal while participating in virtual brainstorm meetings.

Nathan Rawlins, the chief marketing officer at Lucid, said that’s because virtual meetings are often a series of monologues where people are often checked out and feel “this meeting is the sort of thing where I could lift weights.”

Rawlins said workers were put off by hearing multiple voices simultaneously, which might not be that distracting in a physical setting. The survey also found that younger workers — as many as 1 in 4 — were even breaking company pandemic protocols and meeting with colleagues in person to discuss work projects.

And corporate leaders found that they had to delay major launches, campaigns, or initiatives. Rawlins says these are exactly the kinds of projects that need people to work together in person and collaborate to finish.

Recognizing the importance of collaboration, some large companies, including those that are offering flexible options to employees, are doubling down on office space. Facebook is leasing all the office space at an ornate New York landmark, the former James A. Farley Post Office building.

Amazon, which so far has said employees can work from home until early next year, just bought the marquee Lord & Taylor building on Manhattan’s Fifth Avenue and leased another 2 million square feet in Bellevue, Wash. But these tech giants will continue to offer employees flexible options, recognizing that much work can be done at home, while betting that their employees are also driven by the human impulse to socialize.

Still, there is a recognition by workers and employers alike that more is possible with virtual settings than before.

“A lot of people have learned that they can work at home, or that there’s other methods of conducting their business than they might have thought from what they were doing a couple of years ago,” the legendary investor Warren Buffett said at the Berkshire Hathaway annual meeting in May. “When change happens in the world, you adjust to it.”

And despite all the misgivings, Microsoft itself announced just last week that its staff will have the option of working from home permanently. It’s what many other companies are — from Facebook and Twitter to Zillow and Nationwide Insurance — are doing.

Many workers enjoy working from home and are saying so. What most surveys show, however, is that they also want to meet their colleagues. They miss the casual moments that spark spontaneous ideas. Some tasks — such as reading, research and writing — can, in fact, be done better in a remote setting. But creative brainstorming sessions, project discussions, new client meetings, onboarding of new employees are better suited to in-person settings.

https://www.npr.org/2020/10/14/923428794/from-the-folks-who-brought-you-boring-meetings-ceos-want-to-ditch-sterile-zoom-c