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IN THIS ISSUE – “…The Form and Substance of Fog….”

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

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

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FOR THE WEEK ENDING SEPT.  21, 2018

 

Newsom, Cox Voice Dramatically Different Goals

Sometimes it seems that California’s two candidates for governor are running for different offices.

Democrat Gavin Newsom casts himself as the leader of the state’s resistance to President Trump, pushing big-ticket issues such as healthcare, education and climate change.

Republican John Cox has focused on pocketbook issues that are narrow in scope but emotionally charged — repealing California’s increased gas tax, and problems at the Department of Motor Vehicles.

The contrast in approach shows how differently the candidates see the issues facing California, and the role they would play in addressing them.

In this deep-blue state, Newsom leads in the polls and fundraising. That leaves Cox — who has never held elected office — to run an insurgent campaign as he tries to chip off Democratic and independent votes.

Cox is focusing on what he calls the “forgotten Californians. ” He helped champion a ballot measure that would repeal the gas tax increase, spending $250,000 toward the effort to put the issue before voters on Nov. 6. He also handed out water bottles to voters in line at a DMV field office in Sacramento last month in an attempt to burnish his image as a man of the people.

Political strategists say the Republican’s game plan is a smart move in left-leaning California, where some GOP voters may reject the president’s polarizing rhetoric or policies.

Trump endorsed Cox ahead of the June primary, giving the lesser-known Republican more visibility and, some argue, a bump in the polls. But Cox hasn’t spent much time discussing the president on the campaign trail and has avoided core Republican issues such as gun rights and abortion.

“Cox is doing exactly what a Republican needs to do, which is to focus on issues that transcend partisanship,” former state GOP Chairman Ron Nehring said. He is focusing on “that teacher, that cop, that blue-collar union worker who is paying the gas tax increase,” he said.

Cox is the campaign chairman for Proposition 6, which would repeal the increase in the state’s tax on gas and diesel sales and a new annual vehicle registration fee that Democratic leaders, including Gov. Jerry Brown and Newsom, say are needed to pay for road and highway repairs.

Signed into law last year, the levies have proved unpopular with voters and have become a liability for some politicians, including former state Sen. Josh Newman of Fullerton, a Democrat who was targeted by Republicans and recalled this year over his support for the tax increases.

Four Democratic congressional candidates in California recently broke ranks with the party to oppose the new fees, which increased the gas tax by 12 cents per gallon and the diesel fuel tax by 20 cents per gallon. At least one of those candidates, Josh Harder of Turlock, is supporting the repeal effort.

Cox is also calling for an audit of the DMV and for the department’s director to step down following revelations about hours-long wait lines and faulty voter registrations.

Department officials said this month that roughly 23,000 voters were registered to vote incorrectly by the DMV, including some who were assigned the wrong political party preference. Wait times at the DMV also shot up over the summer amid the rollout of new programs.

Bob Shrum, a former Democratic operative who is director of USC’s Center for the Political Future, said people have been angry at the DMV for decades and questioned whether Cox’s call for an investigation would bring in votes.

“How many people have marched to the polling booths under a banner that says ‘audit’?” Shrum said.

With the state’s poverty rate hovering at 19%, according to U.S. Census Bureau figures, the Republican is trying to link Californians’ financial woes with the DMV and higher gas tax.

“The biggest issue of this campaign is affordability,” Cox wrote in an email to The Times. “Paying $700 a year more for gas, or waiting in line for hours at the DMV instead of being at work or with your family, those are all products of the affordability crisis faced by millions of Californians forgotten by the Sacramento political class.”

California voters have a history of bucking higher fees. They revolted after Democrat Gov. Gray Davis’ 2003 decision to triple the state vehicle license fee, which helped fuel his recall and the election of Republican Gov. Arnold Schwarzenegger.

But Davis said in an interview that he doesn’t see parallels between the gas tax and the license fee, because the recent tax increase is more “modest” than his fee.

Cox’s campaign is “predicated on the false assumption that policy issues will drive people to the polls who otherwise wouldn’t vote. That’s never proven to be the case in California, with the exception of Prop. 13 in 1978,” Davis said, referencing the state measure that capped property tax increases.

The effort opposing the measure to repeal the gas tax — which includes the California Chamber of Commerce — has raised $14 million, four times as much as the Proposition 6 campaign has brought in.

On other issues, Cox has faced some criticism for a lack of detail on how he would implement his policy proposals. His website lists a host of topics, including homelessness, healthcare and the environment, but few solutions.

Newsom took a shot at his opponent last week, saying that some of Cox’s plans “have the form and substance of fog.”

But the lieutenant governor has been criticized for his own stances on the issues facing California — in the primary, Democratic rivals accused him of flip-flopping or equivocating on some policy positions.

The former San Francisco mayor dismissed the notion that his campaign is focused solely on grand policy ideas and not the everyday problems of Californians. He said he has concrete plans to address affordable housing and ensure people in the state have access to adequate healthcare and child care, among other needs.

“Those seem to be the manifestation of pocketbook issues,” Newsom said in an interview last week after holding a rally for Harder.

Newsom released a new television advertisement Thursday that promises to “renew the California dream” to ensure that babies have quality prenatal care, toddlers can attend preschool, students have access to after-school programs, and graduates can find jobs.

Still, questions remain over how he’ll pay for his big visions, which include universal healthcare in California. One high-profile proposal for statewide care through a state-run single-payer system would cost as much as $400 billion per year, according to a legislative estimate.

Newsom has argued that California’s healthcare system already costs that much. He cites the San Francisco universal healthcare system adopted in 2006 while he was mayor, but hasn’t offered specifics on how a state plan would be funded.

Newsom’s focus on Trump, not Cox, also allows him to highlight broad, national issues as he seeks to pivot away from his opponent. Women’s reproductive rights, marriage equality, immigration, healthcare and more “are under attack by an administration determined to move our country backwards,” Newsom says in a video called “California Values” on his website. “Let’s show Donald Trump what our bold progressive future really looks like.”

According to a Public Policy Institute of California poll in July, Newsom was supported by 55% of likely voters, Cox was backed by 31%, and 9% were undecided. A more recent poll by Probolsky Research found a much closer gap, with Newsom leading by 44% to Cox’s 39%.

Veteran Democratic consultant Darry Sragow said Newsom is following the typical campaign strategy of a candidate leading in the polls — making sure he doesn’t give his rival any chances to challenge him.

As the front-runner, Newsom “doesn’t have an obligation to engage with his opponent,” Sragow said.

Because Cox hasn’t held elected office, the Republican has the freedom to be more critical, Sragow said. Besides an aborted run for president in 2008, Cox also ran unsuccessfully for Congress twice in Illinois.

“He can pretty much say or do anything because he’s doesn’t have a record that he has to worry about contradicting or defending,” Sragow said. “He can just take shots.”

http://www.latimes.com/politics/la-pol-ca-campaign-issues-california-governor-race-20180921-story.html

 

Measuring Emission Reduction is Imprecise

For years, presidents and prime ministers have been the public face of the fight against climate change, gathering at United Nations summit meetings and pressuring each other to reduce emissions.

The results have often been lackluster.

climate conference in California last week tried something different. The meeting, organized by the state’s governor, Jerry Brown, had far fewer national leaders present. Instead, an array of governors, mayors and business executives from around the globe met to promote their successes in cutting greenhouse gas emissions locally and to encourage one another to do more.

A key premise of the conference was that if a handful of leading-edge states, cities and businesses can demonstrate that it’s feasible — and even lucrative — to go green in their own backyards, they might inspire others to follow suit. That, in turn, could make it easier for national leaders to act more forcefully.

“If a researcher does an experiment, and you find out they’ve got a medicine that works, it spreads,” Governor Brown said.

There was no shortage of announcements at the meeting. Cities like Tokyo, Rotterdam and West Hollywood signed joint pledges to only buy zero-emissions buses after 2025. Companies like Walmart and Unilever rolled out new programs to limit deforestation in their huge supply chains. Dozens of philanthropic groups committed $4 billion over the next five years to fight climate change.

But it will take time to tell whether these local actions can scale up quickly enough to make a significant dent in global emissions. And scientists are warning that time is short if we want to avoid the worst effects of climate change.

On Thursday, a group of researchers released a road map for what it would take to keep global warming below 2 degrees Celsius, the internationally agreed-upon goal. It entailed a rapid transformation of the world’s energy system (measures such as banning the sales of gasoline vehicles in many cities within a decade) that went far beyond many of the proposals made in California.

The sheer scale of that challenge hasn’t fully sunk in with many policymakers, said Johan Rockström, a sustainability scientist and co-author of the report. “We need to be thinking about exponential changes.”

The American politicians at the conference, who typically came from liberal cities and blue states like New York and Washington, had a more immediate concern: Trying to persuade the rest of the world that the United States hasn’t completely abandoned the fight, despite the fact that President Trump has vowed to withdraw from the Paris Agreement on climate change.

Governor Brown met with Xie Zhenhua, China’s chief climate negotiator, and announced plans for California and China to work together on zero-emissions vehicles and fuel-cell research. Later in the week, several blue-state governors met behind closed doors with the environment ministers of Canada and Mexico to forge new partnerships on issues like electric vehicles and curbing emissions of methane, a potent greenhouse gas.

It was an unusual situation: A handful of American governors were effectively taking the lead on international climate diplomacy at a time when the president has disengaged on the issue. But some foreign officials were happy to reciprocate.

“It is important to show the world that we’re still working with U.S. states,” said Catherine McKenna, Canada’s minister of environment and climate change, in an interview. “There really are practical things we can do together.”

There were even a few substantive policy announcements. California, New York, Maryland and Connecticut said they would craft new regulations to curtail hydrofluorocarbons, the highly potent greenhouse gasses used in air-conditioners and refrigerators. In 2016, nations agreed on a treaty to phase out these gases, but Mr. Trump has not submitted the pact for ratification or written federal regulations.

While businesses would prefer a single federal standard, even a few states acting together could create a significant market for cleaner alternatives to HFCs, said Caroline Davidson-Hood, general counsel for the Air-Conditioning, Heating, and Refrigeration Institute, an industry group.

Yet for all that, local leaders in the United States who have promised to uphold the Paris climate agreement still face an uphill battle.

Their coalition — which now consists of 16 states, Puerto Rico, hundreds of cities and nearly 2,000 businesses — has vowed to press ahead with climate action and ensure that the United States meets former President Barack Obama’s Paris pledge to cut greenhouse gas emissions 26 to 28 percent below 2005 levels by 2025.

new report commissioned by the group found, however, that United States emissions are on track to fall only about 17 percent over that span.

Those states and cities would have to pursue ambitious new policies, like retrofitting hundreds of buildings to make them more energy efficient and plugging methane emissions from landfills, to get closer to the target. They would also have to persuade several other states beyond the blue coastal enclaves to join them, the report found.

“We can’t just leave this to the states that have been the first movers,” said Mary Nichols, who heads the California Air Resources Board. “We need others to join us as well.”

 

Looking ahead to the U.N. talks

While the California conference did see a flurry of announcements by states, cities and businesses from around the world, some of them seemed more aspirational than anything else, at least for now. It is unlikely that this meeting, by itself, will drastically alter the trajectory of the world’s emissions.

For example, mayors from dozens of the world’s largest cities promised to cut the amount of trash they send to landfills in half, build more carbon-neutral buildings and encourage walking and cycling in their cities over the next few decades. But how well these mayors follow through remains to be seen.

Despite questions like that, however, some analysts made a case that one big benefit of the conference could be to generate a broader sense of momentum around action on clean energy and global warming as United Nations climate negotiations are entering a particularly difficult phase.

In December, countries will meet in Poland to finalize a “rule book” for implementing the Paris Agreement — touching on contentious topics like how to track and verify emissions cuts. Over the next two years, many nations will then have to decide whether to strengthen their national pledges on climate action, which are currently far too weak to avoid drastic warming.

Yet preliminary negotiations around these issues fell into disarray at talks in Bangkok this month, as poorer countries accused wealthier nations, including the United States, of reneging on their promises for financial aid to fight climate change.

“The U.N. talks are still locked in this finger-pointing dynamic, where people act as if tackling climate change as a zero-sum game,” said Alden Meyer, the director of policy and strategy for the Union of Concerned Scientists, who had flown to San Francisco from the Bangkok talks.

“The atmosphere here in California has been different, there’s a real can-do spirit,” he said. “We’ll see if that mentality can permeate upward.”

https://www.nytimes.com/2018/09/15/climate/california-climate-summit.html

 

California’s Zero-Emission Delimma

CalMatters Commentary

Jerry Brown publicly denies harboring thoughts of the legacy of his record 16 years as California’s governor.

When a reporter asked Brown about it in January, Brown replied, with a characteristic smirk, “Can you tell me the legacy of Goodwin Knight? Or Gov. (Frank) Merriam. Or (George) Deukmejian? Governors don’t have legacies. That’s my No. 1 proposition.”

Brown pointedly excluded his father, Pat Brown, from his list of legacy-bereft predecessors. And it’s quite obvious that Brown yearns to match his father by being remembered as the governor who made California—at least in his mind—a global leader in fighting climate change through reduction of carbon dioxide emissions.

Just before hosting a global climate-change conference in San Francisco last week, Brown signed a bill decreeing that California’s electrical energy will be 100 percent from renewable or carbon-free sources by 2045.

Simultaneously, he issued an executive order that California be “carbon neutral” by the same date.

“This bill and the executive order put California on a path to meet the goals of Paris and beyond,” Brown declared, referring to the international climate agreement. “It will not be easy. It will not be immediate. But it must be done.”

The legislation, Senate Bill 100 by state Sen. (and U.S. Senate candidate) Kevin de León, a Los Angeles Democrat, expands the current 2030 goal for electric power of 60 percent.

Both pieces of state paper, however, are more statements of lofty intent than quantifiable policy.

The technology to achieve 100 percent carbon-free electric power doesn’t yet exist because the main sources, solar panels and windmills, require the sun to shine and the wind to blow. Making them dependable would require enormous banks of batteries or some other form of reliable storage.

The legislation slyly backtracks on previous policy by, in effect, allowing large hydropower reservoirs to be counted as renewable sources. Even so, some means would have to be found to reliably replace the nearly 50 percent of California’s power now generated by natural gas, coal or nuclear reaction.

And then there’s the cost of such a conversion, even if it’s technically feasible. Opponents of SB 100 noted that California already has some of the nation’s highest utility rates.

Dorothy Rothrock, president of the California Manufacturers and Technology Association, said, for instance, “We do know that middle-class manufacturing jobs will disappear as ever-higher electric rates divert resources from expansions, modernization, wages and product development.”

Brown’s “carbon neutrality” order, if seriously implemented, would be even more difficult to achieve.

While electric-power generation is a major source of carbon emissions, the biggest one, by far, is the automobile.

Californians drive more than 300 billion miles a year. Achieving carbon neutrality would require most, if not all, of that travel to shift into electric-powered transit systems and electric-powered cars.

However, public transit accounts for only about 10 percent of travel now. And while California leads the nation in the sales of “zero-emission vehicles” or ZEVs, they still are tiny fraction of Californians’ cars and current auto purchases, and motorists are not rushing to buy more.

The auto dilemma illustrates the conundrum posed by Brown’s efforts to make California a carbon-neutral state. Although polls, including a new one from the Public Policy Institute of California, indicate that Californians support carbon reduction in principle, they’ve not been fully told what it would take to reach the goal, or what financial sacrifices they would bear to reach it.

Those issues will be confronted, if at all, long after Brown has moved into his carbon-neutral retirement home in the Colusa County foothills.

https://calmatters.org/articles/commentary/gov-jerry-browns-carbon-free-legacy-at-what-cost/

 

US is #1 Oil Producer

For the first time since 1973, the United States is the world’s largest producer of crude oil, according to preliminary estimates published on Wednesday by the Energy Department.

The feat demonstrates how the US shale oil boom has reshaped the global energy landscape. American oil output has more than doubled over the past decade.

“It’s an historic milestone and a reminder: Never bet against the US oil industry,” said Bob McNally, president of Rapidan Energy Group, a consulting firm.

Texas is the epicenter of the shale boom. Production in the Permian Basin of West Texas has grown so much that in February the United States vaulted above Saudi Arabia for the first time in more than two decades, according to the US Energy Information Administration.

US output kept climbing in June and August, reaching nearly 11 million barrels per day. That nudged the United States ahead of Russia for the first time since February 1999, the EIA estimates.

The United States isn’t expected to cede its crown any time soon. The EIA expects US oil production to stay ahead of Russia and Saudi Arabia through 2019.

The achievement underscores the profound impact of rapid technological advances in drilling. Fracking unlocked vast sums of oil and natural gas that had been trapped underground. Drilling costs declined dramatically.

“That changed the game for the US. It meant we could be resilient and competitive,” said Ben Cook, portfolio manager at BP Capital Fund Advisors, an energy investment management firm.

That resilience was required after oil prices crashed beginning in late 2014. OPEC launched a price war to regain market share lost to the United States and other oil producers. Falling prices knocked dozens of US oil companies out of business and caused widespread job losses.

US oil production declined — but not as dramatically as feared. And when prices began to rebound in 2016, US shale companies were able to quickly ramp up output. Their expenses were lower — and technology had improved.

Another important change: America now has oil customers around the world. In late 2015, Congress lifted the 40-year ban on exporting crude oil. The United States now ships oil to South America, Europe and China.

https://money.cnn.com/2018/09/12/investing/us-oil-production-russia-saudi-arabia/index.html

 

Groundwater Limits Must be Immediate, Court Rules

For the first time, a California court has said state and county governments have a duty to regulate groundwater usage when it’s clear that the pumping drains water from adjacent rivers.

“This is going to be an immediate obligation, not one that they can wait 20 years,” said James Wheaton of the Environmental Law Foundation, an Oakland nonprofit that won the lawsuit. “They’re going to have to act now.”

The Aug. 29 ruling by the Third District Court of Appeal involves the Scott River in Siskiyou County, an obscure 60-mile tributary of the Klamath near the Oregon border that suddenly looms as a major artery in California water law. Wheaton said the ramifications go far beyond Siskiyou’s borders.

“This ruling applies statewide,” he said.

The court case spotlighted the often overlooked connection between rivers and aquifers. Rivers aren’t just fed by rainwater and melting snow; they also depend on groundwater. Richard Frank, a UC Davis law professor who worked on the lawsuit, said farmers in the vicinity of the Scott pump so much groundwater that portions of the river go nearly dry during the summer. That has had a devastating effect on fish populations, including the endangered coho salmon.

“That’s jobs and dollars and our livelihood,” said Glen Spain, a lawyer who worked on the case and regional director of the Pacific Coast Federation of Fishermen’s Associations. “If you’re a fish, a dried-up river is death.”

Ironically, the ruling would probably have the least impact in parched regions like the San Joaquin Valley, where aquifers already have been drained so badly that they no longer feed the rivers, said Brian Gray, a water-law expert at the Public Policy Institute of California.

The court established a broad, general principle – essentially, that groundwater pumping that harms rivers violates California law, and Siskiyou County officials must take that into account when they allow new wells to be drilled. Additional court cases or other actions would be needed to establish hard-and-fast rules on what’s permissible, Wheaton said. He said the Environmental Law Group hasn’t decided which steps to take.

“Is this going to change anybody’s pumping next year? Not to my knowledge,” said Chris Scheuring, general counsel at the California Farm Bureau Federation.

But the ruling could eventually have an effect in plenty of places. Ellen Hanak, a water-policy expert at PPIC, said groundwater pumping by wine grape growers has been shown to reduce flows significantly on the Russian River, for example. In one case, a decade ago, the river ran so low that endangered salmon were left to die on the river banks, prompting regulations requiring farmers on the Russian to coordinate their pumping activities to keep flows high enough.

Last month’s court ruling could eventually bring far stricter restrictions. The Farm Bureau was concerned enough that it argued in court against the ruling.

Restricting groundwater pumping “could have a significant negative economic impact on many landowners, and frustrate long-existing, investment-backed expectations to a water right that has never before been so limited,” the Farm Bureau’s lawyers wrote in a legal brief with the Pacific Legal Foundation, a property-rights nonprofit in Sacramento.

Groundwater is California’s lifeline, particularly in agriculture. According to the Public Policy Institute of California, aquifers generate about 40 percent of the water used by farms and cities. In lean times, it gets worse. During the recent five-year drought, farmers drilled thousands of new groundwater wells and extracted as much as 8.4 million acre-feet of water out of the aquifers each year, according to a UC Davis study. An acre-foot is about 326,000 gallons.

Alarmed about falling water tables and other consequences, the Legislature acted in 2014 to rein in groundwater consumption. The Sustainable Groundwater Management Act will require “critically over-drafted” groundwater basins to come into balance – meaning farmers will have to put as much into the basin as they take out – by 2040. The groundwater basins in better shape have until 2042 to become sustainable. Generally speaking, “sustainable” means the basins are in no worse shape than they were in January 2015.

Regional agencies are in charge of developing the sustainability plans, and state officials who oversee SGMA say last month’s court ruling won’t change that. The decision “does not interrupt DWR’s implementation of SGMA nor uproot development of groundwater sustainability plans by local agencies,” said Joyia Emard, a spokeswoman for the Department of Water Resources, in an email.

Even with two decades-plus of lead time, farm advocates say SGMA will likely force the permanent retirement of hundreds of thousands of acres of farmland. Environmentalists, however, say the Scott River can’t wait for the law’s deadlines to kick in.

In its lawsuit, the Environmental Law Foundation cited a legal doctrine known as “the public trust.” It’s a powerful doctrine, rooted in ancient Roman law, and says the state and county governments have the duty to protect public resources such as water. The public trust doctrine was the basis for one of the most important legal decisions in California water history – the state Supreme Court’s 1983 ruling that gave broad protections to Mono Lake on the eastern slope of the Sierra. That ruling prompted state regulators several years later to significantly curtail the city of Los Angeles’ ability to draw water from the lake.

Now the concept is being applied to groundwater pumping and the impact it has on the state’s rivers. “If you pump out the groundwater and deplete the river, you potentially violate the public trust,” said the PPIC’s Gray.

In the lawsuit, Siskiyou County officials said there was already a law in place to rein in pumping operations – the SGMA groundwater law – which overrides the public trust issue. The court flatly rejected that argument. Siskiyou County’s attorneys couldn’t be reached for comment for this story.

Wheaton said he doesn’t want to use the ruling to hurt farmers, who he said have suffered plenty in recent years. But he said the rivers have to be protected, and soon.

With the ruling, “we have a very powerful tool,” the environmental lawyer said. “We want to wield it in a way that’s responsible but effective.”
https://www.sacbee.com/news/state/california/water-and-drought/article218300410.html#storylink=cpy

 

California Ag #1 in US, Pierces $50-Billion Mark

The USDA’s Economic Research Service (ERS) has released its first production data summaries for 2017 in California, with a total for the year of $50.13 billion, an increase of $3.7 billion from 2016, or six percent. The ERS also provided an upward revision its production figure for 2016, changing it from $46.04 billion to $47.4 billion. Please note that the 2017 figure is subject to revision, as well.

California remains the leading agricultural state in the nation, with about 13 percent of total US production. California leads the country in dairy production and many other commodities, and it provides roughly half of the nation’s fruits, nuts and vegetables.

Here are the Top-10 California commodities for 2017:

  1. Dairy products, Milk – $6.56 billion
  2. Grapes – $5.79 billion
  3. Almonds – $5.6 billion
  4. Strawberries – $3.1 billion
  5. Cattle and Calves – $2.63 billion
  6. Lettuce – $2.41 billion
  7. Walnuts – $1.59 billion
  8. Tomatoes – $1.05 billion
  9. Pistachios – $1.01 billion
  10. Broilers (Chickens) – $939 million

More in-depth production data will be provided by the ERS in the weeks and months to come, and California Ag export statistics as well as California counties reports will be completed in a collaborative effort between CDFA, the USDA and the University of California at Davis.

https://www.cdfa.ca.gov/statistics/