California schools and social services are about to take a major hit, as tax money for the state's coffers came up billions of dollars short. The Legislature's nonpartisan fiscal adviser, the Legislative Analyst, detailed the problem.
From Greg Lucas in California's Capitol: "State revenues will be $3.7 billion less than expected, triggering $2 billion in cuts – more than half to public schools – according to an economic forecast issued by the Legislative Analyst on November 16."
"The gloomy assessment of the 44-page California’s Fiscal Outlook includes the state ending this fiscal year with a $3 billion deficit and being an additional $10 billion short of spending commitments in the next fiscal year, which begins July 1, 2012."
“One year ago, we wrote that the U.S. economic recovery was progressing more slowly than previously expected. Once again, we have to make the same observation,” the analyst says."
"The annual forecast takes on greater significance this year because it’s one of the yardsticks used in determining whether to impose a series of as much as $2.5 billion in spending cuts approved as part of the budget signed by Gov. Jerry Brown on June 30."
The economy may be miserable, the budget in tatters and unemployment at double-digit levels. But the lobbying industry is doing just fine, thank you very much. Capitol Weekly's Cindy Baker has the story.
"Clients with interests before state government have spent roughly $14.4 million per month during the first nine months of the year, which works out to about $482,000 a day, according to state financial disclosure records. Some political observers say the amount may even be higher."
"Nearly 350 individual lobbyists and lobbying firms pulled in a record $130 million during the first three quarters of 2011."
"The lobbying totals, when broken down, reflect the depth of the spending: They work out to about $20,062 per hour or $334.36 per minute, or about $5.57 per second.
That’s not bad for a recession, although only a limited few are benefiting."
You may never have heard of a "benefit corporation," but you soon will: Come January, benefit corporations will start establishing themselves in California. Capitol Weekly's Greg Lucas tells the tale.
"A new breed of company is coming to California in January. A company that cares about the rest of the world, its proponents say. And agrees to be audited each year to prove it. This new business model is what’s called a “benefit corporation.”
"California joins five other states allowing companies to have dual, co-equal purposes: Making money and doing good."
"What form the second part of the equation takes can be almost anything imaginable from purchasing locally to progressive employment policies. One Maryland benefit corporation, Blessed Coffee, sends 50 percent of its profit to social programs in Ethiopia and the rest to local nonprofits."
The state attorney general has subpoenaed records of Fannie Mae and Freddie Mac -- remember them?" -- in order to get information about their handling of toxic assets as they relate to home mortgages.
From Alejandro Lazo and Jim Puzzanghera in the LA Times: "The subpoenas ask the government-controlled finance companies to answer a series of questions about their activities in California, including their roles as landlords who own thousands of foreclosed properties. The attorney general's office is also seeking details of Fannie and Freddie's mortgage-servicing and home-repossession practices, according to a person familiar with the matter."
"In addition, investigators want to learn more about the companies' purchases and sponsorship of securities holding "toxic mortgages" in the Golden State, said the person, who was not authorized to speak on the matter and requested anonymity."
"Fannie and Freddie declined to comment on the investigation. Shum Preston, a spokesman for state Atty. Gen. Kamala D. Harris, also declined to comment."
The Orange County Transportation Authority is considering whether to ask the state to halt the proposed bullet-train, the latest in a series of conmplaints from locals who question the wisdom of the massive statewide project.
From Tracy Wood in the Voice of OC: "The 17-member board will vote next month on the wording of a message it plans to deliver to the state's High-Speed Rail Authority, which has overall authority to contract for construction of the rail system if the state Legislature and federal officials approve financing."
"OCTA plans and builds most Orange County highway and rail systems, using federal, state and local tax money. But it has no jurisdiction over the planned 520-mile high-speed rail project."
"A vote of no-confidence would come in part from a Republican-dominated board and be directed at Gov. Jerry Brown and Democratic legislators and members of Congress who support the rail plan."
"But it was a Republican, former Anaheim Mayor Curt Pringle, who spearheaded much of the local support for the project. Pringle also served on the OCTA board and chaired the High-Speed Rail Authority in 2009 and 2010."