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THE NOONER for August 6, 2012

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THE END GAME - "RACE TO THE STOP"

The Legislature returns today for a frenetic 25 days until the end of session. And, while election years frequently have an effect on the race to the stop, this year is of Olympic proportions. Specifically, the placement of Propositions 30 and 32 on the November ballot puts constraints on otherwise routine deliberations.

Most importantly, Jerry Brown must orchestrate an elegant ballet that keeps the cash, which will mostly come from labor, flowing for his tax measure while also not overreaching and inviting money against. The California Chamber of Commerce has stayed neutral thus far on the measure, although it only takes a conference call meeting to oppose and launch a campaign about it being "tax on small business." Howard Jarvis opposition is one thing, while the Chamber is whole other animal.

Meanwhile, Brown hope to continue to enlarge his fundraising base beyond labor, and the end of session provides a unique opportunity to do that. However, the checks from business and individuals for ballot measures usually come in the under $100,000 category, unlike the $1 million pledged last week by the California Nurses Association. On Saturday, Los Angeles-based Zenith Insurance, which cares about workers comp issues, kicked in $100,000 to the effort.

It is not clear whether Speaker John Perez and Pro Tem Darrell Steinberg will be the gatekeepers against "anti-business" legislation that will keep the Chamber neutral, whether the governor will be the bad guy, or, most likely, a mix of both. Already, Steinberg has an olive branch for business with his SB 1186, which would require notice and an opportunity to correct disability access issues before lawsuits may be filed.

Aside from the inside game of keeping supporters and opponents in check and the money flowing, the public perception of the end of session is on legislators' minds. Democratic leaders and labor both know that the public perception of the end of session, as told by editorial pages and news articles, needs to be of a responsible Legislature that is tackling the state's financial problems and perceived pension abuses.

I'll write more about the details of pension reform in the coming weeks, but make no doubt that the issue is the most important in the next 25 days. Labor isn't happy and there may be lawsuits depending on what is included in the final package as labor insists that some provisions must be collectively bargained. Labor also understands that there is no bigger item that will drive editorial boards to look favorably on Proposition 30 and against Proposition 32 than pension reform.  

It is debatable whether editorials affect voters much. I've long believed that the only people who read the opinion pages of newspapers are those that already have opinions. However, I believe they have significant credibility in political television ads. For Props. 30 and 32, ads that have "teachers, firefighters and cops" backed up by the state's major papers will be very powerful and could tip the balance in favor of Prop. 30 and against Prop. 32, the two biggest priorities of legislative Democrats and their labor supporters.

Finally, look for lots of orchestrated drama about the $59 million found in the Parks' accounts and the $119 million found in other accounts. It's mostly budgetary kabuki. The "found" money likely won't make up for the "lost" money associated with the underperformance of Facebook

PENSION REFORM: CA legislators take on pension reform [Wyatt Buchanan @ SFChron]

PENSION CONFORM: Private-sector pension proposal sets off lobbying war in California [Dan Walters @ SacBee]

SB 1234 is up on Wednesday in Assembly Appropriations. 

ICYMI: Lucrative gambling pits tribe against tribe [Norimitsu Onishi @ NYT]

$$$: CTA kicks in $7.5 million against Proposition 32.

WTF? This woman was the GOP's veep nominee four years ago and is in underoos today.

 

TOP HEADLINES ON AROUNDTHECAPITOL.COM AS OF 12:00PM
City Bankruptcies Target Retiree Health Care Costs
Ed Mendel @
calpensions.com
The cost of retiree health care promised state and local government employees, growing at a faster pace than more-publicized public pensions, has become a common target for cuts in a string of California city bankruptcies.

Private-sector Pension Proposal Sets Off Lobbying War In California
Dan Walters @
sacbee.com
This is not the first time that state Sen. Kevin de León has proposed a state-sponsored pension system for the more than 6 million California workers whose employers don't offer retirement benefits. But the Los Angeles Democrat's latest effort, Senate Bill 1234, is only a couple of votes away from reaching Gov. Jerry Brown's desk, and it's touched off a titanic lobbying war.

CA Legislators Taking On Pension Reform
Wyatt Buchanan @
sfgate.com
After a monthlong break, the Legislature returns to work at the Capitol on Monday to take on one of the Golden State's thorniest issues: public employee pensions.

Lawsuit, bill aim to keep K-12 education free in California
George Skelton @
latimes.com
Legislation and an ACLU lawsuit tackle the increasing use of fees at public schools, a trend that is unfair to low-income students and increases disparities.

Rick Orlov's Tipoff: President Villaraigosa? Well, Not So Fast
Rick Orlov @
dailynews.com
What will Antonio do next? That is the question that has dogged Mayor Villaraigosa almost since he took office in 2005, with various folks predicting he would run for governor or U.S. Senate or be appointed to the president's Cabinet.

Scandal Spurs Plan To Keep Closer Eye On State Parks Budget
Katharine Mieszkowski @
baycitizen.org
A little-known commission could be empowered to provide more oversight of the California Department of Parks and Recreation after an investigation revealed the department sat on a multimillion dollar budget surplus for years.

School Funding Primer: A Is For Alligator
John Fensterwald @
edsource.org
It’s called “the alligator chart” because it looks like a reptile’s gaping maw. Nicknamed by its creator, the Sacramento-based education consulting firm School Services of California, it’s one graph that voters should clip on their refrigerators to remind them what’s at stake this November when they consider more money for K-12 schools. School Services shared an updated version with district officials recently during its annual budget management seminars around the state.

Bank Says San Bernardino County Eminent Domain For Mortgages Proposal May Not Be Worth Controversy
Andrew Edwards @
dailybulletin.com
A Royal Bank of Scotland analysis questions a controversial proposal for a San Bernardino County agency to use eminent domain to buy "underwater" mortgages.

Real Estate Bubble Bursts For California Lawmakers Too
Patrick McGreevy @
latimes.com
In the boom years, several California legislators bought homes but now are having trouble keeping up with mortgages or avoiding big losses.

Dan Walters Daily
Hannah Madans @
blogs.sacbee.com
of California legislators, lobbyists and bills, bills, bills.

L.A. Case Pushes For 1-Drug Execution
Bob Egelko @
sfgate.com
It's been 6 1/2 years since California's last execution, and nearly that long since a federal judge suggested that the state replace its challenged three-drug sequence with a single, fatal dose of a powerful anesthetic - a change that prosecutors in Los Angeles are now demanding in a potentially precedent-setting case.

In Missouri Senate Race, Ads Beset Incumbent Democrat
nytimes.com
The campaign against Senator Claire McCaskill of Missouri, fueled by tax-exempt groups backing Republican candidates, may be a precursor to such efforts on a broader scale.

Brown has Golden State thinking big even in tough times
Rich Ehisen @
statenet.com
During the 30-plus years Barbara O'Connor has known California Gov. Jerry Brown (D), she says the man once derided as "Gov. Moonbeam" has developed a well-deserved reputation as someone never inclined to back down from a big challenge.

Bill Would Expand Penalties For Nonprofits, Fundraisers That Misuse Funds
Kendall Taggert @
californiawatch.org
Amid reports of some nonprofits mismanaging charitable donations, the state Legislature is considering a bill that would increase the authority of the state attorney general's office to crack down on organizations that violate the law.

Romneys, Caught In Housing Bust, Got Tax Cut In La Jolla
Robin Abcarian @
latimes.com
Mitt and Ann Romney won reductions in the assessed value of the La Jolla home they bought for $12 million, saving them about $109,000 over four years.

"Waste, Fraud, And Abuse" A Hollow And Hypocritical Critique
Seth Rosenblatt @
edsource.org
There are many critiques of the public sector by those in the private sector; some have validity, while others ring hollow. I have written about examples of both, but a great illustration of the latter is the oft used criticism that governments - including our public schools - are guilty of "waste, fraud, and abuse." It harks back to a quote allegedly by Otto von Bismarck that "laws, like sausages, cease to inspire respect in proportion as we know how they are made." It does indeed seem that the work of our public schools is like sausage-making: slow, sloppy, and ugly at times.

Davis Biotech Company Agraquest Is A Striking Success Story
Dale Kasler @
sacbee.com
In the Sacramento area, where high-tech startups struggle and big payouts are rare, what's happened to the Davis biotech company is nothing short of remarkable. AgraQuest, which makes chemical-free pesticides and fungicides, agreed to be sold last month for $425 million – one of the richest takeovers the region has seen in years. The buyer is agribusiness giant Bayer CropScience.

Election 2012 battleground shrinks as states fall in line
David Lauter @
latimes.com
The presidential election battleground has shrunk over the course of the summer as states have begun falling into predictable patterns and campaigns have begun to place their bets for the fall.

Political Blotter: Get ready for Gray Davis' 70th-birthday roast
Josh Richman @
mercurynews.com
Recalled governor Gray Davis will be honored and roasted at a November event in Sacramento; also, Mitt Romney reaches out to Asian-American voters.

HRC sends $1 million to state gay marriage efforts
Maggie Haberman @
politico.com
The Human Rights Campaign is directing $1 million in cash to four states with gay marriage ballot initiatives this November, a new chunk of funding for efforts to make history with a statewide win among voters an issue on which polls show public opinion shifting.

Some Area Cities Had To Make Big Payments To State For Former Redevelopment Agencies
Wes Woods II @
sbsun.com
Some Inland Empire cities' successor agencies to their redevelopment agencies recently had to pay fees - some higher than $4 million - to the California Department of Finance, which upset city officials and a local economist.

2012 London Olympics: In Producing Olympians, California Is Shaming Texas
Tony Olivero and Sara Germano @
online.wsj.com
If California were its own Olympic team, it would have bigger delegation in London than Mexico, Turkey or Switzerland. The 128 members of Team USA hailing from the Golden State represents 23% of all the Americans at the Olympics—by far the most. Considering roughly 12% of the population is from California, even by percentage difference the state dominates the Games.

Romney tops Obama's July fundraising by $25 million
Matea Gold @
latimes.com
WASHINGTON – For the third month in a row, Republican presidential challenger Mitt Romney’s campaign outraised the reelection effort of President Obama, scooping up $101.3 million, while the president pulled in more $75 million.