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News of the Day: Tuesday, June 22

* Affordable housing issues in Santa Monica; developer "slips out" on agreement with the city.....  Santa Monica Daily Press reports on an interesting situation in Santa Monica involving developer JSM Construction.  Seems that JSM, which built much of downtown Santa Monica's housing supply, has now failed to construct 52 affordable housing units that it was required to build under an agreement with the city.  Now folks are asking whether the rules governing such arrangements (in-lieu fees) need to be changed, also what are the financial remedies available to the city to enforce the agreement, etc....

* "A budget, a budget, who's got a budget?"  Sac Bee columnist Dan Walters discusses the "three-way stalemate" regarding the state budget:  That "the governor has a budget that fellow Republicans more or less support.  Assembly Democrats have a budget whose centerpiece is a complex scheme to borrow billions of dollars.  And Democratic senators have a budget that's based on raising taxes and shifting some programs from the state to counties."  So, now what does everyone do to even try to bridge the gap???  (Sac Bee)

 * "Devils brew of sins"....And, speaking about the state budget, LAT columnist George Skelton says "state employees are not the budget culprits"; also, that, until the state deals with the real causes of the fiscal fiasco in Sacramento, we should all "prepare for more misery."  Skelton argues that "one persistent myth about the perpetually bleeding state budget is that it's all the fault of public employee unions."  And, while the unions are to blame for some things, they are actually not the root cause of the current $19-billion budget deficit.   Rather, "California's budget nightmare stems from "a devil's brew" of various sins...."  (LAT)

* High-speed rail legislation; scrutiny of rail contractor's Nazi-era ties....  Sacramento Bee reports that local San Fernando Valley Assemblyman Bob Blumenfeld wants to give officials something new to think about when awarding massive contracts for the state's high speed rail system - whether the bidder transported Nazi victims to death camps during World War II."  Blumenfeld's legislation would give the  high speed rail authority "the legal right to disqualify a French firm or other railway companies from construction contracts for their role in wartime atrocities committed more than six decades ago."   He says the legislation will help persuade a French company to disclose the extent of its involvement in Nazi death-camp transportation and to pay reparations or make other amends.  (Sac Bee)




News of the Day: Monday, June 21

The Summer Solstice arrives today.  First day of summer, longest day(light) of the year......

*  Ban on project labor agreements in public sector contracts; non-union contractors looking to place this on ballot in 2012......    LABJ reports that, after their recent success at the polls in San Diego County in gaining voter approval of bans on new project labor agreements that give unions an advantage in bidding on public sector contracts, "non-union contractors are now targeting Los Angeles and Long Beach" to seek similar bans.  And that, if the signature-gathering is successful, it is possible that this may end up on local ballots sometime in 2012.  Which would then likely mean a $$$major political battle.....   (LABJ)

*  Brand new LAPD $74-million, state-of-the-art jail remains empty.....  When the LAPD began construction on its new jail four years ago, plans were for a state-of-the-art facility to address many of the failures and issues related to the almost 60-year-old existing facility.  Now the new jail is ready, with all kinds of gadgets, devices and technology to make it about as good as one might ever expect and, with five floors and spanning 172,000-square feet, one of the largest of its kind.  And the old one is decrepit and in miserable shape.  But because LAPD does not have adequate funds to pay for hiring enough jailers to run the new "labor-intensive facility", the new jail remains empty.  Much to the frustration of all involved.  (LAT)
*  Olvera Street, what to do regarding collection of new, increased rents; questions re legal issues, politics...  Downtown News editorial argues that, even with (another) revenue shortfall of almost $900,000 apparently in the works this year at Olvera Street (with these funds having to be made up from the city's general fund), there does not appear to be either the political or legal will at City Hall to pursue collection of higher rents even from merchants who were given timely legal notice of these increases but who have deliberately refused to pay same.  And that this is unfair both to the merchants who have complied as well as to the city as a whole.   (DTN)

News of the Day: Saturday/Sunday, June 19-20

* "Death by 1,000 cuts"....  Fees to clean up a crash scene:  $498; more if the work takes more than an hour.  Fee to owner who wishes to surrender a pet to the city's animal control office:  $25; also, $20 for disposing of a dead cat or dog.   Increase in developer fees for plan checks; increase in fees for street artist permits; increase in food-permit fees for caterers. 
No, not just in Los Angeles.  These are items on the table in San Francisco, where Mayor Gavin Newsom has included more than two dozen new or higher fees in its budget plan for the fiscal year starting July 1.  And, not unlike Los Angeles, the driving force behind looking at various increased "fees" as a means of balancing the budget rather than new taxes is that taxes in California require voter approval, which is often a daunting prospect.  
Thus, "Newsom's budget steered clear of new taxes.  Several supervisors, however, have floated options for the November ballot that, if targeted correctly, they say would be a more equitable way to bring in money.  Business leaders have criticized the proposals as job killers."  (SF Chron)
* Another twist, another turn:  Carson mobile home park conversion litigation, tenant concerns regarding efforts to lift the city's rent control laws.... Daily Breeze reports on the latest court ruling and what it means or may mean in terms of subdividing mobile home parks in the city of Carson and/or what it may mean in terms of lifting the city's strict municipal rent controls  (DB)
* Election-year deficit fears:  Will there be more stimulus money from Washington coming any time soon???   Politics, politics, politics.  And especially election-year politics. 

Washington Post reports that "Congress has delivered only a quarter of the $266 billion in 'temporary relief measures' the president sought in his February budget request and ignored the rest.  There is unlikely to be another 'recovery' for Social Security recipients."  
And, "come December, Obama's 'Making Work Pay' tax credit -- the signature initiative he regularly touts as a tax cut for 95 percent of Americans -- will probably be gone.  Even the state aid that Obama last week called critical to preventing the layoffs of hundreds of thousands of teachers and other government workers is foundering.  After days of talks, frustrated Democratic leaders in the Senate failed muster the 60 votes needed to approve the cash and left town for the weekend with no clear path forward."  (WP) 
* And, also on the subject of stimulus funding, Washington Post columnist Ezra Klein ponders the issue of the stimulus and the "anti-stimulus". and how all of this is playing out vis-a-vis "the sharp fiscal contraction of state and local governments."  That is, where budget deficits are requiring governments to raise taxes or cut services and where "these budget shortfalls are the equivalent of a massive anti-stimulus, which some experts believe has overwhelmed" the original $787 billion approved by Congress last year.  (WP)
Seems like the "fiscal pickle" being encountered in Sacramento and elsewhere across the country with regard to budget shortfalls, employee benefits and pensions is attracting more and more attention and commentary....

    "California's fiscal pickle" -- possible "bombshell" regarding calculation of pension fund contributions required by CalPERS, CalSTRS, UC Retirement System as well as local governments.  (Sac Bee)

* Also from the Sacramento Bee:
  * Nearly $2.75 billion in paid time off due to California government employees = the equivalent of nearly 11 weeks of paid leave owed to each of the state's 176,000 state workers when they quit or retire.  (Sac Bee)
* And from the New York Times:  "Many states are acknowledging this year that they have promised pensions they cannot afford and are cutting once-sacrosanct benefits, to appease taxpayers and attack budget deficits." 

Some mechanisms used so far include raising the retirement age, requiring employee payments into the pension fund, requiring a minimum numbers of hours per week be worked in order to earn pension credit -- but almost all of the changes to date have been only in terms of employees hired in the future, while current employees will continue to keep building up their pensions at the current rate.  With the notable exception here being Colorado, "which has imposed cuts on its current workers, not just future hires, and even on people who have already retired."  (And where retirees have sued to block the reduction....) 

"Other states with shrinking funds and deep fiscal distress may be pushed in this direction and tempted to follow Colorado's example in the coming years.  Though most state officials believe they are legally bound to shield current workers from pension cuts, a Colorado victory could embolden them to be more aggressive." (NYT)
 * Clarification of language for California water bond.....   Seems that the folks in charge of drafting the language of the $11 billion water bond on the November ballot may not have been as rigorous in dotting the i's and crossing the t's as they might have been, leading to a situation where folks in Sacramento are now trying to clean this up by way of legislation introduced this past week to "strike a provision that would allow private corporations to own, operate and profit from dams and other water storage projects built with taxpayer dollars." 
SF Chronicle reports that, in approving the package of water bond legislation including the water bond measure) last year, legislators say they did had not noticed the provision in the 26-page bill until it was pointed out to them in December.  "Since then, some legislators have been reassessing their support of the proposition, and the provision has been used by opponents in campaign materials to try to defeat the spending measure."
Also, at least some "opponents of the measure say they welcome the change, but that it would not move them to support the measure because it has too many other provisions they do not like, including the construction of dams.  They also are concerned because the bond will cost $24 billion out of the general fund over 30 years."   (SF Chron)
* The business of politics -- in India......    Washington Post reports that reaction to a proposed five-fold increase in pay for federal lawmakers in India is, perhaps understandably, mixed:
"'We cannot forever be stuck in Gandhi's image from the freedom movement.  In comparison, people think we are all corrupt crooks looting the nation'", writes a Congress Party lawmaker from Mumbai in an op-ed arguing for the raise.  And, perhaps not unlike what might occur elsewhere, there has been more than just a bit of a public outcry to legislation that has been recommended by a committee and that will soon be introduced in Parliament... where it is expected to face little opposition.  (WP)


News of the Day: Friday, June 18

*  Consulting contract at Port of L.A. to former L.A. deputy mayor.....  Kevin Acebo, former deputy mayor to Antonio Villaraigosa, will now oversee external affairs and lobbying efforts for the Port of Los Angeles.  Acebo, who served as deputy mayor for governmental affairs for three years, left City Hall in 2008 and now has a Long Beach-based consulting firm. 

Daily Breeze reports that Acebo will be paid $190,000 for the year-long contract with the Port.  The scope of his services under the contract will include responsibility for overseeing the Port's lobbying at the state and federal level, as well as marketing and communications.  (DB)

*  AEG and Jackson family to "contribute" $1.3 million to help cover costs of Michael Jackson memorial last year....  Yes, it will be a year next week since the Michael Jackson memorial service at Staples Center and the Nokia Theater.  And also a year with much media coverage of the back-and-forth between the parties -- including well-publicized requests by L.A. City Attorney Carmen Trutanich that AEG pick up the entire cost of public services provided by the city in connection with the very large-scale event. 

Now, after all of the to-and-fro and jostling between the various parties, it appears that an agreement has been reached with the Jackson estate and AEG wherein the parties will "contribute" $1.3 million to help pay for some of the costs of the event.  The $1.3 million will include $1 million to the city's general fund and another $300,000 to the Los Angeles Police Foundation to help pay for equipment for the LAPD.  (DN, LAT)
*  Renewable energy legislation in Sacramento.  Moving forward???  Capitol Weekly reports that "a landmark agreement requiring California's utilities to get one-third" of their energy from renewable sources "is within striking distance."  And that negotiations have been under way for months between the governor's office and various interest groups, with  participants now saying they are close on this important issue that involves billions of dollars of worth of energy production and thousands of job at stake. "But close can be far in the Capitol."  ( Capitol Weekly )
*  And, speaking of renewable energy, Capitol Weekly  also has another interesting piece, this one on wind turbines and their increasingly important role in providing alternatives to traditional energy sources.....

*  And for those who are interested in stimulus programs and spending on infrastructure, an interesting Washington Post piece comparing what China has done in this regard vs. what has taken place in the U.S.....  In an effort to stave off a recession and keep their economy moving, in late 2008 the Chinese government initiated a $585 billion stimulus program.  The funds became the driving force behind infrastructure projects being built just about everywhere throughout the country, whether needed or not and whether or not the loans taken out to pay for the projects or the bonds floated by local municipalities could be repaid.  Now, with the stimulus program about to expire in six months, the question is what will happen when these bills come due?   (WP) 

News of the Day: Thursday, June 17

* LAX Hotels, living wage ordinance in the news (LAT ) again....  This time by way of a lawsuit filed against the LAX Hilton by a group of current and former employees:

"The Hilton Los Angeles Airport Airport allegedly hired scores of workers through a subcontractor in an illegal scheme to circumvent a city law mandating that airport-area hotels employees receive a 'living wage', according to a lawsuit filed Wednesday.      

 "The civil suit, filed on behalf of some 150 current and former hotel workers allegedly cheated out of legal wages, seeks back pay for affected employees and a court injunction ordering that Hilton comply with the city's living wage law in the airport area."  

The issue is an important one to organized labor, which has been pressing for adoption of living wage ordinances not just in Los Angeles but also elsewhere across the country.  And with the business community often opposing the laws as being too costly and burdensome. 

With regard to the LAX Hilton, the hotel has for some time been the target of picketing by Local 11 of the Hotel and Restaurant Employees union (UNITE HERE) as part of a long-time drive to organize the hotel.  As for the litigation that has just been filed, UNITE says they support the workers' efforts but that they are not directly involved in it and that the lawsuit is not directly linked to the organizing drive or the boycott.  

* L.A. City layoffs moving forward.....    With the July 1 fiscal year deadline rapidly approaching, it appears that negotiating sessions to stave off a round of job layoffs were not successful sessions.  The sessions were held yesterday between the city's employee negotiating committee -- composed of the mayor and four council members -- and union officials with regard to holding up pink slips to 278 employees effective July 1.  Key issue at hand continues to be city officials' argument that the layoffs could be avoided if the unions agree to some form of concessions, something which the union officials say is unacceptable to their members.  (LAT) (DN)  

* Food trucks controversy continues, escalates.....   Food truck afficionados love them, established local restaurants not so much, particularly in terms of owners' arguments that the trucks both take away business and take up scarce metered parking spaces that the restaurants say they need..  So, now Councilman Tom LaBonge -- who represents the Miracle Mile area where the trucks have proliferated -- has stepped into the fray with the introduction of two motions that could lead food trucks to being banned on many city streets.  According to the LAT, LaBonge's efforts have generated a campaign by food trucks owners and some of their patrons against the proposals as well as against the councilman himself.

* Bill Rosendahl says "no" to Bundy Village as currently proposed (Rosendahl statement):

"I do not support the project as currently proposed.

"In February 2010 I supported “in concept” the development of senior housing and medical services at Bundy Village.  I expressed my concern about the size and scale of the project, and its traffic impacts.

"I made it clear that the project must be refined to address my concerns, and my constituent concerns, about the project’s traffic impact and scale.  Since that time, the project has not been refined to do so.

"I encourage the developer to go back to the drawing board with a project that has dramatically less traffic and significantly more community support." 

* L.A. Chamber successfully defeats anti-business proposal at L.A. City Council....  Full cost recovery  effort of developer fees will not be implemented at this time; instead, the city will stick with an agreement reached last year with city officials to do this over a three-year period.   The Chamber is pleased with the council vote to uphold the 2009 phase-in plan.  From Chamber e-newsletter:

"The Chamber applauds the L.A. City Council's vote Tuesday to uphold a 2009 agreement between the business community and City officials. Known as 'full-cost recovery,' the agreement called for a three-year phase in period for higher overhead fees on land use applications. The Chamber joined building trades unions to oppose a motion introduced by Councilmember Paul Koretz to reverse this agreement and increase fees immediately. 'Saddling projects with higher fees now is counterintuitive when there is 40 percent unemployment in the construction industry', said Chamber VP of Public Policy Samuel Garrison. "'We applaud the City Council for putting jobs before politics and keeping this  agreement intact.'"

 * Wendy Greuel audit; Councilman Paul Koretz not happy with DWP....   "'Trying to lie to the council and scam us is outrageous and I don't think we can just let it go'", said Koretz, who chairs the council's Audits & Governmental Efficiency Cmte., as part of a discussion regarding motion asking for a report from the mayor and the DWP "spelling out the form of punishment that will result from the DWP's threat" to withhold the $73.5 million from the city budget three months ago.  Koretz "said he also wants to know whether Villaraigosa's office had a hand in the DWP's threat.  'I suspect there are folks in both offices who are responsible, because the mayor was clearly pushing hard' for the rate increase....'And the DWP was the agency that transmitted all this misinformation.'"  (LAT)  

* Carson City Council not happy with contents of a Hallmark graduation card....    Daily Breeze reports that the Carson City Council voted unanimously this week in support of a resolution urging Hallmark to withdraw a graduation card (video) that contains the words "black hole" from all stores across the country where the card is sold.  The issue was raised by the Carson-Torrance branch of the NAACP, which protested the card on the grounds that the words sound too much like "black whore" or "black ho" and that the group believes the wording in the card is the source of severe emotional pain for its members because it is a disguised racist attack on black women.  (DB)   

* Sacramento term limits measure unlikely to qualify for statewide November ballot....   Sacramento Bee reports that a measure to change current term limits for legislators looks unlikely to make it onto the November ballot.  The measure, backed by the Los Angeles County Federation of Labor and the Los Angeles Area Chamber of Commerce, would create a 12-year cap on legislative terms, either all in one house or split between the Senate and the Assembly, and, unlike a prior failed effort to amend the term limits law, this one would not apply to politicians currently in office or those elected this year.    And, although supporters turned in the 694,000 valid voter signatures from across the state that are needed to qualify the measure for the ballot, this figure is not enough to qualify on the basis of a random sample process.  Instead, Secretary of State Debra Bowen directed county election officials to conduct a full verification of all voter signatures, which is a process that will likely take the effort beyond the June 24 qualifying deadline for the November ballot.  A spokesman for the campaign effort supporting the measure says he is confident the full count will show they have the necessary number of valid signatures and that the measure will then go on the next statewide election ballot after November.  (Sac Bee

* State budget deficits, Sacramento -- and Albany:  questions, political issues regarding "budget borrowing".....   Here in California, Attorney General (and Democratic gubernatorial nominee) Jerry Brown "has concluded that Assembly Democrats' plans to borrow billions to help ease the state's $19.1 billion deficit could be illegal" under Proposition 58, the ballot measure approved by voters in 2004 that "prohibits various kinds of borrowing to fund year-end budget deficits...."  The governor is pleased with the A.G.'s opinion.... (Sac Bee)  

And lest we forget that California is not the only place where legislators are struggling to find ways to put together a budget without taking the unpopular steps of cutting services and/or without raising taxes, today's New York Times reports that yesterday, in Albany, Governor David Paterson "dealt a potentially fatal blow to the centerpiece of his lieutenant governor's tenure by declaring that he would accept no borrowing to help resolve the state's budget crisis."   "'I will not sign a budget that has any deficit financing in it', he said.  'I don't want any borrowing, tobacco funds or any other way of meeting this end'....'I think that will clear this up once and for all, so that we don't have to discuss it any further.'"  "Yet, despite what Mr. Paterson said, a new budget will almost certainly include borrowing.  The governor's staff said that a recently agreed-upon plan to allow the state and local governments to borrow billions of dollars from the state's pension fund remained on the table...."  Also, "legislative leaders would not rule out further borrowing."  (NYT)

* And, also from Sacramento, the latest regarding CalPERS, the use of placement agents and management fees....   Sacramento Bee reports that "two more private equity firms have agreed to cut management fees for CalPERS and stop using the controversial middlemen known as placement agents when pitching deals" to the fund.  The two new firms are Ares Management (of Los Angeles) and Relational Investors (of San Diego).  Earlier this year, in what is viewed as a major breakthrough in this regard, CalPERS secured an agreement with Apollo Global Management (New York) to cut its fees by $125 million and to stop using placement agents.   (Sac Bee)

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