Money hunt

Feb 3, 2012

One time-honored tradition of state budget writing is coming back: Raiding special funds in order to balance the state's books. Special funds are financed by specific fees or taxes -- fuel taxes to pay for highways, for example -- and the money is supposed to go to a specific purpose. But when times get tight, the push to get the special funds' money gets stronger.


The LA Times' Chris Megerian takes a look: "Lawmakers voted Thursday to increase the state's ability to borrow from dedicated funds to cover day-to-day expenses, part of a strategy to keep California from falling into the red."


"If Gov. Jerry Brown signs the bill, it is expected to free up $856 million from transportation-related funds. The state can already borrow from roughly $20 billion worth of dedicated funds, according to Brown's Department of Finance. “We’re pleased the Legislature moved on this bill and we look forward to acting on it in the days ahead,” said Evan Westrup, a spokesman for Brown."


The Bay Citizen, the New York Times' partner in the San Francisco area, is involved in merger negotiations with nonprofit journalism groups. The leading contender to run the whole show is the former editor of the San Francisc Examiner.  You'll need a program to keep the players straight here, but the Bay Citizen's  Peter Lewis gives it shot.


"The unexpected death of Hellman left The Bay Citizen without its founder and benefactor. In September, the news organization’s founding editor-in-chief, Jonathan Weber, resigned abruptly. In October, the founding chief executive, Lisa Frazier, announced that she would resign in early 2012 for personal reasons. Last week, the interim editor-in-chief, Steve Fainaru, a former Pulitzer prize-winning investigative reporter for The Washington Post, announced that he was resigning to pursue a book project."


"In the weeks before Hellman’s death, sources say, he began discussions with a local newspaperman, Phil Bronstein, then a vice president at Hearst Corporation, to take over as chief executive of The Bay Citizen when Frazier stepped down. Her last day on the job is Monday. She declined to comment for this article."


"Bronstein, 61, who was editor of The San Francisco Chronicle from 2003 until 2008 (previously he served as the executive editor), is president of the board of the Berkeley-based Center for Investigative Reporting, CIR, another nonprofit journalism group that was founded in 1977. As a board member, Bronstein was involved in the creation of California Watch, a project of CIR, which assembled the largest team of investigative reporters in California. California Watch was formed in 2009 and distributes what it calls high-impact journalism to more than 80 different publications. CIR and California Watch have a combined editorial staff of 27."


CalSTRS, facing lower returns on investments, scaled back its forecast, a move that at least one observer was a bow to reality.


From the Bee's Dale Kasler: "The teachers' retirement board agreed Thursday to reduce CalSTRS' official investment forecast to 7.5 percent, down from 7.75 percent. It was the second cut in 14 months, after the $144 billion fund left the forecast untouched for 15 years."


"In a volatile investment climate, following a year in which CalSTRS' portfolio earned just 2.3 percent, board members took their consultants' advice and went with the lower number."


Also from the Bee: Scott Plotkin, the former executive director of the California School Boards Association who stepped down amid a scandal about his pay and bonuses, will have his pension cut by two-thirds.


From the Bee's Melody Gutierrez: "A California Public Employees' Retirement System audit to be released today concluded that Scott Plotkin's pension was improperly inflated over a period of years by excessive raises that were granted out of public purview. Based on that finding, the auditors said, the raises cannot be counted toward retirement calculations."


"Plotkin said Thursday he would appeal the decision."


The impacts of Facebook's IPO are still being assessed, but one ripple effect may come in the form of increased business for thousands of small companies. Maybe.


From the Mercury News' Peter Delevett: "The number of startups that have sprung up in recent years to make money via Facebook's platform easily runs into the tens of thousands, said Steve Garrity, co-founder of Hearsay Social. The San Francisco company helps big brands like 24 Hour Fitness manage relationships with customers using social networks."


"Garrity and others say the coming tsunami surrounding Facebook's initial public offering will impact that startup "ecosystem" in a number of ways. Facebook itself, flush with as much as $12 billion in post-IPO cash, could well go on a buying binge to plug holes in its offerings. And with as many as a third of Facebook's 3,000 employees expected to become millionaires, valley veterans say a new generation of startups will be seeded."

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