June 24, 2019

Made in California

Helping to Define What it Means to be “Made in California”

Written by Lenny Mendonca, Director of GO-Biz

Let me start with an admission: government officials—at all levels—don’t do a good job of engaging the public as we grapple with big, complex challenges.

Hearings only go so far. Videos and social posts get into only so much detail and nuance. And, most importantly, most of what we do is based on how we want to communicate to you, not on how you want to engage with us.

Today, my team at the Governor’s Office of Business and Economic Development is launching a new podcast called Made in California to change that dynamic.

The podcast will be hosted by Aneesh Raman, our head of strategy and external affairs, who knows a bit about storytelling. He’s a former CNN reporter and Obama speechwriter.

He and our team will speak not just to members of the Gov. Gavin Newsom’s team but also to civic leaders across the state who are working toward more inclusive, sustainable, resilient, and equitable growth in California.

Make no mistake: that is the defining challenge of our time.

I am the grandson of immigrants and grew up on a farm in Turlock. My life embodies the California Dream.

Today, that dream is not well. California is the fifth-largest economy in the world. We are leaders in almost every area you can imagine, from technology to agriculture to arts. We are the place where new ideas most often turn into new industries, thanks to venture capital funding, innovative startups, world-class universities, state-of-the art labs and our diverse talent pool.

But we are also the state where too many Californians are working hard and still falling behind. We’re the richest and poorest state in the nation with 8 million of our fellow Californians living below the poverty line.

One in five kids lives in poverty in this state. We’ve got a cost crisis when it comes to housing, healthcare and education. Economic growth is mostly happening in our coastal communities and not enough inland.

Left unmanaged, the changes that technology and climate change are bringing to the nature of life and work are set to only exacerbate those challenges.

We’ve got some work to do to make sure our economy is working for everyone so that we have an economy that is built to last, for this generation and the next. And that’s what we’re going to be talking about on Made in California.

We hope you’ll listen.

We hope you’ll engage in the efforts. And we hope you’ll bring your stories to the podcast, just like Heather Evans, the artist who created the original theme song for our podcast–also called “Made in California.”

Heather moved to California from Ohio hoping to land on her California Dream. And, like her song says, it was a challenge fighting for her dream–even believing that it was possible–but you can’t be afraid to leap.

Because, when you do leap, when you do fight for your California Dream, you will learn that you were made to win because, through grit and courage, you were made in California.

We are excited to fight for that dream right alongside you. Join us in this adventure.

Lenny Mendonca is chief economic and business advisor to Gov. Gavin Newsom and director of the Governor’s Office of Business and Economic Development, GO-Biz, lenny.mendonca@gobiz.ca.gov. He wrote this commentary for CALmatters.

Homeless Students

CALmatters

Democrats who control the Legislature approved a budget last week that would provide two years of tuition-free community college.

On Wednesday, a representative for California Community College Chancellor Eloy Ortiz Oakley raised concerns about funding for homeless students.

  • Democratic Assemblyman Marc Berman of Palo Alto is carrying legislation that would require the campuses to provide overnight access to their parking facilities by homeless students.
  • Berman cited a report by the Chancellor’s Office that found 19% had experienced homelessness.

Berman: “The students are doing this tonight. This bill doesn’t create students sleeping in their car. This bill tries to provide a safer place for them to do what they’re already doing.”

The Chancellor’s Office has not taken a stand on the bill, community college legislative analyst Justin Salenik testified:

“If the Legislature wishes for something like this to happen, there should be funding to allow us to fulfill this sort of mandate and also—maybe more importantly—to get more financial aid resources into our students’ hands.”

The Senate Education Committee approved the bill, sending it to its next hearing.

Budget Expediency Overwhelms Logic

Written by Dan Walters, CALmatters

Many factors go into making political deals – ideology, self-interest, expediency and emotion to mention just a few.

Logic rarely enters the equation, and if it does, it usually dwells at the bottom in importance.

Two cases in point are to be found in the final deal on a $213 billion state budget that was hammered out last weekend, just a few days before the June 15 deadline, by Gov. Gavin Newsom and legislative leaders.

The first is an agreement to use money from the state’s “cap-and-trade” program of auctioning off carbon emission allowances to improve local water systems, mostly in impoverished communities. Up to a million Californians now have substandard water supplies so the goal is certainly a worthy one.

Newsom and his predecessor, Jerry Brown, wanted a tax on water to generate money for the much-needed repairs, but legislators were worried about a backlash were they to impose such a tax while the state is running up multi-billion-dollar budget surpluses.

The expedient solution was to tap the cap-and-trade fund, which is supposed to be used for projects that reduce greenhouse gases, but that has evolved – surprise, surprise – into an all-purpose political slush fund.

The rationale offered by Newsom budget adviser Vivek Viswanathan was, to put it mildly, creative.

“In these communities where there isn’t access to safe drinking water, you’re often bringing in bottled water, you’re trucking in water that’s safe to drink and all of these have emissions impacts,” Viswanathan said. “We believe these investments not only help those communities by giving them safe drinking water but also fulfill the goals of the cap-and-trade program.”

That very strained, and completely illogical, rationalization for political expediency further undermines the original intent of the system and further converts it into just another hidden tax on consumers. Cap-and-trade, for instance, raises gasoline prices by an estimated dime a gallon.

Example No. 2 is the decision to expand state-subsidized medical insurance, including – for the first time anywhere – to some undocumented immigrant adults.

To finance the expansion, Newsom and legislators agreed to reinstate the “individual mandate” that was part of the original Obamacare legislation but was erased by Congress and President Donald Trump two years ago.

Those who didn’t purchase health insurance in some fashion were to be fined. Newsom proposed, successfully, to reinstate the fines in California of $695 a year or 2% of income, whichever is greater.

“Without the mandate, everybody’s premiums go up,” Newsom said in proposing it, adding that Obamacare “has been vandalized” by the mandate’s removal and “We’re here to get it back on firmer footing.”

Here’s the catch: Newsom, et al, characterize the charges for non-compliance as fees, rather than taxes, thus evading the two-thirds legislative votes needed for taxes.

However, when the federal individual mandate was before the Supreme Court, it ruled 5-4 that it is a tax. As Chief Justice John Roberts put it, “The Affordable Care Act’s requirement that certain individuals pay a financial penalty for not obtaining health insurance may reasonably be characterized as a tax. Because the Constitution permits such a tax, it is not our role to forbid it, or to pass upon its wisdom or fairness.”

Logically, how can fines for failing to buy insurance be considered taxes by the U.S. Supreme Court – the only way they could be considered legal – but as fees by California’s state government?

By expediently stretching definitions to their breaking point, these two budget actions, no matter how well-intended their purposes, contribute to popular cynicism about manipulative politicians.

$13 Billion School Construction

$13 Billion School Construction Bond Targeted for 2020 Ballot

Written by John Fensterwald, EdSource

Legislation to put a $13 billion school construction bond on the state ballot next year and a second bond in 2022 moved forward this week with strong support overall from the education community — and a vague promise by the bill’s author to address concerns that state building aid to school districts isn’t equitably distributed.

With $9 billion in state funding from the last state bond, in 2016, either spent or committed, Assembly Bill 48 received unanimous approval of the Senate Education Committee after a short hearing on Wednesday. But important details remain to be fleshed out before the full Senate votes later this summer and Gov. Gavin Newsom has yet to give his opinion of the proposed amount and other aspects of the bill. The size of the second bond also hasn’t been determined. School construction bonds that voters passed in 2002, 2004 and 2006 ranged from $10.4 billion to $13.1 billion.

California Plan For School Construction Bonds Sparks Debate For Reform

Under the state school construction program, the state supplements the cost of construction projects that school districts and community colleges fund with bonds raised through local property taxes. The state pays half of the cost of a new school and pays for 60 percent of the cost of renovating a school or college campus.

AB 48 would include preschool facilities in next year’s next bond, and the bill’s author, Patrick O’Donnell, D-Long Beach, who chairs the Assembly Education Committee, confirmed Wednesday that $500 million would be set aside for charter school construction — the same as in the 2016 bond, Proposition 51. There also would be money to fix water systems contaminated by levels of lead violating federal standards. But where the rest of the money would go hasn’t been set. If Prop. 51 is a guide, however, $10 billion would likely go to K-12 districts and $3 billion to community colleges.

During an EdSource webinar about the state building program on Tuesday, panelist Eric Bakke, legislative advocate for the California School Boards Association, a co-sponsor of AB 48, said he’d favor more money for modernization than for new construction — reflecting the need to repair aging buildings statewide and, in many districts, declining or stagnant student enrollment. A study last year for the Getting Down to Facts research project, organized by the research nonprofit PACE and Stanford University, found that the current state formula favors school districts with larger tax bases, particularly for renovating schools. Higher property values enable them to issue school bonds qualifying for large state matching grants. Those districts also tend to have families with higher than average incomes and fewer low-income students.

While property values have significantly risen, especially in the Bay Area and the coast, they’ve have been slow to rebound from the recession a decade ago in the Central Valley and inland regions, limiting the ability of districts in those regions to issue bonds to cover their needs.

In “Financing School Facilities in California: A Ten-Year Perspective,” co-author Jeff Vincent, who co-directs the Center for Cities + Schools at UC Berkeley, provided extensive data about how the state allocates money for construction projects under its School Facilities Program.

He found that the bottom fifth of districts, averaging $900,000 in taxable property per student, received an average of $661 per student in modernization aid from 1998-2017. The top fifth of districts, with an average of $2.4 million in taxable property per student, averaged eight times that much — $5,361 per student.

“If the Legislature moves forward without fixing inequities in funding, it will be doing a huge disservice to school districts and children in low-wealth communities,” Vincent told EdSource.

Another challenge is the application process for state grants. Once the state qualifies districts, matching grants are awarded on a first-come, first-served basis, which can disadvantage small districts without full-time staff to determine building needs and write proposals.

O’Donnell said in testimony Wednesday that his bill addresses some of the issues raised. Small districts would receive technical help and project management to navigate the application process. Requirements for the “hardship” program, providing construction aid of up to 100 percent for districts with very low property values, would be changed to potentially qualify more additional small districts.

“It’s encouraging to see some provisions in the bill that look to be equity-promoting although it’s unclear the extent to which they would make an impact,” Vincent said Wednesday.

Vincent, Bakke and representatives from school districts, teachers union and organizations representing the building trades who testified Wednesday, all agreed that state aid is needed now and want to see a state bond on the ballot as early as next March. That would coincide with the Democratic Party’s presidential primary in California.

Recognizing it’s too late to make big changes now, advocates are looking toward the second bond to revise the formula. O’Donnell said he remains open to having more discussions and improving the program. He said he left “placeholder” wording regarding the 2022 bond to allow that to happen.

But that wording doesn’t commit the Legislature to study reforming the current formula or to change it. That’s why the League of Women Voters, the ACLU and the student advocacy groups Public Advocates and the Advancement Project said they would support AB 48 only if it includes language specifically to address inequities that Vincent’s study cited.

“I have seen enough to raise concerns about equity. As the bill moves forward will you make an effort to look into these issues?” Maria Elena Durazo, D-Los Angeles, asked O’Donnell before voting to pass the bill.

Enforcing Meal Periods with Mobile Staff

Written by Anna Savini, American Time and Labor Company

There has been a spate of recent lawsuits and litigation regarding employers’ lack of compliance with demanding California labor laws when it comes to home health care employees’ meal periods and rest breaks. This matters even to those not based in California, as non-local companies (except those with corporate headquarters in Arizona or Texas) who have staff working in California must also conform to California Department of Labor regulations, and other states are also increasing regulations in these matters.

It is important to research local and state laws because many areas are moving toward tighter rules and requiring employer compliance. Companies will be held responsible for violations that hurt the bottom line; those who violate these laws risk large sums of money and the larger the company, the larger the financial loss.

Understanding the California Law

Under California’s wage-and-hour law, employers are required to provide all non-exempt employees a 30-minute unpaid meal break per eight-hour shift, and provide a second 30-minute meal break if the employee works more than 10 hours. These meal breaks can be waived if there is a mutual written agreement between the employee and employer. Additionally, if the employee does not work more than six hours, the first 30-minute meal period can be waived; the second meal period can be waived as long as the employee did not waive the first meal period.

A meal break must be at least 30 uninterrupted minutes. An employer cannot require or knowingly permit an employee to work through his or her lunches. The employee must be relieved of all work duties during the meal period and be permitted to leave the premises for the full duration of the meal break.

There are very limited circumstances in which an “on-duty” lunch is permitted, and it requires an essential need on the employer’s part that is directly related to the nature of the work performed. That is, the work is unable to be accommodated in any other way—and the burden is on the employer to prove that such a need exists. In addition, meal periods must be compensated if the employee is required to be on call, even if the employee is relieved of all other actual duties during the meal period.

According to calchamber.com, an employer may not require an employee to work for a period of more than five hours per day without providing him or her with a 30-minute unpaid meal break. If the employee is unable to take one or more meal breaks, they will be owed one hour of pay.

Under California law, nonexempt employees should have an opportunity to take a 10-minute paid rest break for every four hours worked or a major fraction thereof. Employers owe the employee an hour of pay if the employee is unable to take one or more rest breaks. The maximum penalty for missed meal breaks and missed rest breaks is two hours of pay per day, no matter how many meal or rest breaks were missed in the day. The additional pay for missed meal or rest breaks must be included in the employee’s next paycheck.

The Importance of Documentation

Documenting meal breaks in the office is simple, but can your company show that your offsite mobile employees are taking the full 30-minute meal period? If a disgruntled employee filed a wage-and-hour lawsuit, would you be able to defend your organization’s practices with data and documenting history?

The solution may be a workforce management mobile application that offers GPS tracking. Look for an app that collects data on time worked, crew clock-in and clock-out, activities performed, job costing, mobile forms, mileage, expenses, digital signature signoff, GPS location and, most importantly, meal period enforcement.

An app that can send alerts to a mobile employee’s phone or tablet will help manage compliance with changing labor laws. Employers can create automated messages such as, “Take a break now,” or “Please take your meal period.” Email or text notifications are sent to management if an employee has not taken a meal period or rest break within a required timeline determined by the employer. This gives the employer the ability to manage breaks and help prevent the possible need for overtime compensation to an employee.

An app with electronic signature capture enables employees to sign off on requirements such as time worked, meal periods and rest breaks. This helps protect the company against any potential litigation from disgruntled employees or class action attorneys.
In addition, all your mobile employees’ time and attendance data goes directly from punch to payroll for processing, simplifying the process. That means employees get paid on time and correctly—which makes for happier employees.

June 17, 2019

Community Service Orientation Day

Gilroy Chamber, GUSD and Gilroy Gardens Partner to Educate Students

The Gilroy Chamber’s Business and Education Committee hosted a Community Service Orientation Day for over 150 – 9th grade students.

The event was designed to help the students learn about their high school graduation requirement of volunteering for 80 community service hours over the next 4 years. The Chamber partnered with the Gilroy Unified School District and Gilroy Gardens, where the event was held.

The students had an opportunity to assist with nearly 20 non-profit organizations who participated as well. The Chamber’s Business and Education Committee designed the event to allow students to meet and interact with various non-profit organizations who need volunteer support throughout the year. The event was a win-win for both the students and the non-profits.

Ken Christopher, from Christopher Ranch, was the keynote speaker and inspired students with his talk about volunteerism. As the event ended, students chalked up 3 volunteer hours to start their Freshman year, learned about one component of their graduation requirement, met nearly 20 organizations where they can volunteer their time, interacted with other students and were allowed into Gilroy Gardens for the remainder of the day.

The Gilroy Chamber’s Business and Education Committee is responsible for planning the annual Rock-the-Mock event which is held at both Gilroy and Christopher High Schools. This year’s Rock-the-Mock event is scheduled for November 7th and 8th. Students who participate in Rock-the-Mock learn how to prepare for interviews, are instructed on what to consider wearing to an interview, learn to shake hands with a potential employer and are taught how their social media activity can affect them when applying for a job. Students then interact with members of the business community working though mock interviews. Last year’s Rock-the-Mock also included a job fair with more than 10 businesses hiring nearly 100 students for part-time, temporary jobs during the holidays.

Chamber Works to Defeat Job Killer Bills

Most Job Killer Bills Already Dead
Written by Dan Walters, CALmatters

(The Gilroy Chamber of Commerce partners with CalChamber to oppose and or amend legislation deemed to be a negative impact on the business community. CalChamber refers to such legislation as “Job Killers.” The Gilroy Chamber is proud to advocate on behalf of our business community to ensure a strong local economy. The article below, written by Dan Walters of Calmatters, describes, not just the success we have had, over the years, but where we stand on this year’s efforts to overcome job killing legislation. – Mark Turner, President/CEO, Gilroy Chamber of Commerce).

Going into this year’s legislative session, it appeared that the California Chamber of Commerce’s long string of wins on bills it labels “job killers” might end.

Over the previous two decades, the chamber and its allies in the business community had killed or neutralized about 90 percent of the bills on the annual list. In 2018, just one targeted bill reached then-Gov. Jerry Brown’s desk and he vetoed it.

The list is a fairly reliable annual guide to the big conflicts pitting business and employer groups against unions, environmentalists, personal injury attorneys and consumer advocates. They typically involve business tax increases, additional civil liability, higher employee compensation and/or more governmental regulation with multi-billion-dollar financial stakes.

This year seemed to be a new opportunity for those four Democrat-friendly groups to advance their agendas. Democrats scored big wins in 2018 elections, jumping from two-thirds supermajorities in both houses to superduper majorities of about 75 percent and the Legislature was clearly tilting further to the left as this year’s session began.

Moreover, Brown had retired after four terms as governor and an outwardly more liberal Gavin Newsom had become governor.

Thus far, though, the chamber is doing fairly well, with all but five of the 31 bills on this year’s list failing to make the session’s first cut – moving out of their original houses by May 31.

As usual, most died without a formal committee or floor vote as their authors parked them, having decided that they lacked enough support, or were quietly killed in the appropriations committees that act as legislative traffic cops.

Although five of the 31 bills are still alive, two of them are virtually identical. Assembly Bill 1080 and Senate Bill 54 would mandate a sharp reduction in the use of plastic packaging by 2030 to reduce environmental degradation. The chamber calls it “an unrealistic compliance time frame.”

AB 1080 is being carried by Assemblywoman Lorena Gonzalez, a San Diego Democrat who clearly relishes having her bills on the list and has scored several notable wins in the past. She was the author of the one bill that Brown vetoed last year, a measure to ban binding arbitration agreements in employment.

Gonzalez has introduced the arbitration ban again this year as Assembly Bill 51. Once again it’s on the job killer list and it’s also one of the five survivors.

In fact, Gonzalez is carrying three of the five. Her third is Assembly Bill 1066, which would allow striking workers to obtain unemployment insurance benefits if the dispute lasts more than four weeks. She raised the threshold from two to four weeks once the bill reached the Senate, evidently hoping to make it more palatable to moderate, pro-business Democrats.

The fifth and in some ways most controversial of the five survivors is Senate Bill 1, carried personally by Senate President Pro Tem Toni Atkins, also a San Diego Democrat. It would empower a variety of state agencies to adopt, without many of the usual procedures, environmental and labor rules that mimic federal regulations before they were weakened by the Trump administration – and allow attorneys to enforce them with lawsuits.

It’s a major component of California’s “resistance” to President Donald Trump and is needed, its advocates say, to protect the state from the Republican president. But, business critics say, it would give too much authority to unelected bureaucrats and create “the potential for costly litigation” – making it a classic example of the “job killer” genre.

What's New With Business?

Eric Howard,  Business Relationship Manager, Gilroy Chamber of Commerce 

After much thought and deliberation, Dr. Eric Nagareda decided to transition his practice to a fine and caring dentist, Dr. Amy Tran. Dr. Nagareda’s goal has always been to conduct his practice with quality, integrity, kindness and compassion. He is pleased to have found a fine experienced dentist in Dr. Tran who shares the same values and goals that have been the hallmark of Dr. Nagareda’s practice over the years. His confidence in Dr. Tran gives him great comfort in this transition. He is very pleased that all of the current staff members will be remaining in the practice to ensure a smooth transition.

Dr. Nagareda hopes his patients will continue to support the staff and practice and he asks that his patients give Dr. Tran a chance to earn their trust as they have so kindly done for him over the years.

Dr. Tran was born and raised in Orange County, California. During her undergraduate education at UCLA, she studied Biology and pursued a double major in Anthropology to better understand human societies and cultures. After she graduated from UCLA, she moved to San Francisco to attend the prestigious University of the Pacific School of Dentistry, where she advanced her technical skills in dentistry as well as built a foundation for how best to take care of her patients. After practicing in Southern California for a few years following dental school, she moved back to the Bay Area to establish her permanent home. Over the past six years of her career, Dr. Tran has had the opportunity to practice dentistry in various clinical settings and serve diverse populations, further developing her practice and art of dentistry. She now looks forward to serving her home community.

Dr. Tran’s professional affiliations include membership in the Santa Clara County Dental Society, in which she serves on the Editorial Board, the California Dental Association, and the American Dental Association. Dr. Tran is married to Dr. Vincent Van of Gilroy Pediatric Dentistry. When she is not practicing dentistry, she enjoys growing her creativity through arts and crafts, improving her cooking skills, and taking fitness classes.

For the first time in its 41-year history, the Gilroy Garlic Festival is welcoming a Grammy Award-winning, multi-platinum-selling singer/songwriter to perform live at the Festival. Colbie Caillat, who has sold over 10 million singles worldwide, will appear with her new band, Gone West, on the Amphitheater Stage on Saturday, July 27. The concert starts at 6:00 pm and is included in the price of Festival admission. The grounds will remain open until 8:00 pm on Saturday evening so that guests can enjoy the show and everything the Festival has to offer. Gone West is a new Nashville-based band featuring two-time Grammy Award Winner Colbie Caillat, multi-platinum singer/songwriter Jason Reeves, four-time Hawaii Music Award Winner Justin Kawika Young, and ACM and CMT nominated artist Nelly Joy. The group debuted at the Grand Ole Opry in October 2018 and recently released a debut EP, “Tides,” through Grayscale Entertainment. To purchase discount tickets online, go to gilroygarlicfestival.com.

Volunteer positions for the Gilroy Chamber of Commerce beer tents at the Garlic Festival are still available but going fast. There are several positions depending on your preference from I.D. checking to beer pouring to ticket selling. Shifts are approximately four hours and for that you get into the Garlic Festival free of charge, receive a meal ticket, two drink tickets and a Gilroy Garlic Festival Brew Crew tee-shirt. The Festival is Friday, Saturday and Sunday, July 26, 27 & 28. Click here to sign up or call the Chamber office at 408-842-6437.

One Heart to Another is a non-profit whose mission is to empower young women to create change in the community. They believe by instilling a passion for community service in young women it not only benefits our community but also makes the world a better place. It also builds strong leaders for the future. One Heart to Another runs five community service projects and recently re-opened Cooper’s Closet at Christopher High School, which is a free boutique that provides clothing, backpacks, hygiene products and more to students. Enjoy a nice evening at, “A Night in the Vineyard,” at Hecker Pass Winery on October 12, 2019 at 5:00 pm. You not only enjoy fine wine but help in One Heart to Another’s fundraising efforts. Tickets can be purchased starting August 1 by going to Onehearttoanother.org and click on the link to buy tickets or call Pamela McKenna at 408-497-4751.

Environmental Legislation

Update on 2019 Environmental Legislation: What Remains?
Written by Chris Michel, Aprea & Micheli, Inc.

Now that the house of origin deadline has passed, and we are basically at the mid-point in the California Legislative Session, we can take a look at pending legislation with particular attention to the bills that will continue along the legislative process in the second house. The focus of this article is on environmental legislation. The following are the major environmental bills of particular interest to the California business community:

AB 138 (Bloom) – Sweetened beverage tax
This bill, subject to specified exemptions, would impose a fee on every distributor for the privilege of distributing bottled sugary drinks and concentrate in the state at a rate of $0.02 per fluid ounce and for the privilege of distributing syrups and powders concentrate in this state, either as concentrate or as sweetened beverages derived from that concentrate, at the rate of $0.02 per fluid ounce of sweetened beverage to be produced from concentrate.

Status: Pending in Assembly policy committee

AB 142 (Cristina Garcia) – lead acid battery fee
This bill would, on and after April 1, 2022, increase the amount of the manufacturer battery fee to $2 and would provide that the fee would continue indefinitely. The bill, on and after January 1, 2020, would authorize a person who manufactures a lead-acid battery and is not subject to the jurisdiction of the state to agree in writing with the importer of that lead-acid battery to pay the manufacturer battery fee on behalf of the importer.

Status: Pending in Senate policy committee

AB 161 (Ting) – Paper receipt ban
This bill, on and after January 1, 2022, would require a business, defined as a company that accepts payment through credit or debit transactions, subject to certain exceptions, to provide a proof of purchase to a consumer only at the consumer’s option and would prohibit a business from printing a paper proof of purchase if the consumer opts to not receive a proof of purchase, unless otherwise required by state or federal law.

Status: Pending in Senate policy committee

AB 342 (Muratsuchi) – Oil and gas prohibition
This bill would prohibit any state agency, department, or commission, or any local trustee with leasing authority over public lands within the state from entering into any new lease or other conveyance authorizing new construction of oil- and gas-related infrastructure upon public lands, including tidelands and submerged lands, to support production of oil and natural gas upon federal lands that are designated as, or were at any time designated as, federally protected lands.

Status: Pending in Senate fiscal committee

AB 345 (Muratsuchi) – Oil and gas operations
This bill would require, commencing January 1, 2020, all new oil and gas, development or enhancement operation that is not on federal land to be located at least 2,500 feet from a residence, school, childcare facility, playground, hospital, or health clinic.

Status: Held in Assembly fiscal committee

AB 457 (Quirk) – Permissible lead levels
This bill would require Cal-OSHA to conduct rulemaking in conjunction with the standards board to complete the rulemaking and adopt the lead standards in the regulations no later than February 1, 2020. The bill would authorize the adoption of emergency regulations by the standards board as necessary to implement these provisions.

Status: Pending in Senate fiscal committee

AB 495 (Muratsuchi) – Cosmetics safety
This bill would prescribe that a cosmetic is adulterated if it contains asbestos, lead, or any of several specified intentionally added ingredients.

Status: Held in Assembly policy committee

AB 647 (Kalra) – Cosmetics
This bill would require the manufacturer of a hazardous substance or mixture of substances that constitute a cosmetic, or are used to disinfect, that is required to create an MSDS, to post the MSDS to an internet website at which the public may find it and access it by its brand name or other commonly known name.

Status: Pending in Senate policy committee

AB 729 (Chu) – Carpet recycling
This bill would require a carpet stewardship organization to include in the carpet stewardship plan a contingency plan should the carpet stewardship plan expire without approval of a new carpet stewardship plan or should the carpet stewardship plan be revoked. The bill would require a carpet stewardship organization to set up a trust fund or an escrow account, into which the bill would require the organization to deposit sufficient funds to implement the programs in the carpet stewardship plan for a period of one year, in the event that the carpet stewardship plan terminates or is revoked.

Status: Pending in Senate policy committee

AB 792 (Ting) – Mandated recycling content
This bill, on and after January 1, 2021, would require a plastic beverage container filled with a beverage by a beverage manufacturer to contain, on average, specified amounts of postconsumer recycled plastic content pursuant to a tiered plan that would require the beverage container to contain, on average, no less than 75% postconsumer recycled plastic content on and after January 1, 2030.

Status: Pending in Senate policy committee

AB 815 (Aguiar-Curry) – Dual stream recycling
This bill would require the department to consider whether the jurisdiction has implemented a dual stream recycling program when considering if the jurisdiction has made a good faith effort to implement its source reduction and recycling element or household hazardous waste element.

Status: Pending in Senate policy committee

AB 841 (Ting) – Drinking water
This bill would require the office to adopt and complete a work plan within prescribed timeframes to assess which substances in the class of perfluoroalkyl and polyfluoroalkyl substances should be identified as a potential risk to human health.

Status: Pending in Senate policy committee

AB 937 (Robert Rivas) – Waste discharge
This bill would authorize a regional board to approve a waste discharge requirement for the use or reuse of produced water from an oil and gas operation for agricultural purposes or for groundwater recharge, only if, after a public hearing, it finds that the California Council on Science and Technology has reviewed the best available independent scientific evidence and has found the use will not pose a significant risk to the public from any contaminants in the produced water.

Status: Held in Assembly policy committee

AB 1080 (Gonzalez) – Plastic recycling
This bill would enact the California Circular Economy and Plastic Pollution Reduction Act, which would establish the policy goal of the state that, by 2030, manufacturers and retailers achieve a 75% reduction of the waste generated from single-use packaging and products offered for sale or sold in the state through source reduction, recycling, or composting. The bill would require the department, before January 1, 2023, to adopt regulations that require manufacturers and retailers to source reduce, to the maximum extent feasible, single-use packaging and priority single-use plastic products, as defined, and to ensure that all single-use packaging and priority single-use plastic products in the California market are recyclable or compostable.

Status: Pending in Senate policy committee

AB 1083 (Burke) – Energy infrastructure procurement
This bill would, until January 1, 2023, request the council upon request by the chairperson of a fiscal committee or certain policy committees of either the Assembly or Senate, the Speaker of the Assembly, or the President pro Tempore of the Senate, to undertake and complete an analysis of the effects of legislation proposing to mandate procurement of electricity products, gas products, energy storage resources, or electrical or gas infrastructure by an electrical corporation, gas corporation, community choice aggregator, electric service provider, local publicly owned electric or gas utility, or any state-level energy procurement entity.

Status: Pending in Senate policy committee

AB 1445 (Gloria) – Climate change declaration
The bill would state the intent of the Legislature that the state Undertake various immediate and large-scale efforts, including conversion of the economy to zero greenhouse gas emissions by no later than 2030, with an immediate phaseout of fossil fuels.

Status: Held in Assembly policy committee

AB 1500 (Carrillo) – Hazardous substances
This bill would repeal the provision authorizing a UPA to suspend or revoke a unified program facility permit, or an element of a unified program facility permit, for not paying the permit fee or a fine or penalty associated with the permit.
Status: Pending in Senate policy committee

AB 1672 (Bloom) – Flushable products
This bill would, among other things, on or after January 1, 2021, prohibit a covered entity, as defined, from labeling a covered product as safe to flush, safe for sewer systems, or safe for septic systems, unless the product is a flushable wipe that meets certain performance standards.

Status: Held in Assembly fiscal committee

AB 1788 (Bloom) – Pesticides
This bill would create the California Ecosystems Protection Act of 2019 and expand this prohibition against the use of a pesticide containing specified anticoagulants in wildlife habitat areas to the entire state.

Status: Pending in Senate policy committee

SB 1 (Atkins) – Environmental defense act
This bill would require specified agencies to take prescribed actions regarding certain federal requirements and standards pertaining to air, water, and protected species, as specified. This bill would authorize a person acting in the public interest to bring an action to enforce certain federal standards and requirements incorporated into certain of the mentioned state laws if specified conditions are satisfied.

Status: Pending in Assembly policy committee

SB 43 (Stern) – Carbon tax study
This bill would require the state board, no later than January 1, 2022, to submit a report to the Legislature on the findings from a study, as specified, to determine the feasibility and practicality of assessing the carbon intensity of all retail products subject to the tax imposed pursuant to the Sales and Use Tax Law.

Status: Pending in Assembly policy committee

SB 50 (Wiener) – Housing development
This bill would authorize a development proponent of a neighborhood multifamily project located on an eligible parcel to submit an application for a streamlined, ministerial approval process that is not subject to a conditional use permit.

Status: Held in Senate fiscal committee

SB 54 (Allen) – Plastic recycling
This bill would enact the California Circular Economy and Plastic Pollution Reduction Act, which would establish the policy goal of the state that, by 2030, manufacturers and retailers achieve a 75% reduction of the waste generated from single-use packaging and products offered for sale or sold in the state through source reduction, recycling, or composting. The bill would require the department, before January 1, 2023, to adopt regulations that require manufacturers and retailers to source reduce, to the maximum extent feasible, single-use packaging and priority single-use plastic products, as defined, and to ensure that all single-use packaging and priority single-use plastic products in the California market are recyclable or compostable.

Status: Pending in Assembly policy committee

SB 69 (Wiener) – Ocean resiliency
This bill would impose various forest practice requirements on a person who discharges sediment into a Class I, II, or III watercourse pursuant to a timber harvesting plan and would require the regional boards to incorporate those requirements into any applicable waste discharge requirements to manage controllable sources of sediment, achieve water quality objectives, and protect beneficial uses.

Status: Pending in Assembly policy committee

SB 392 (Allen) – Consumer products
This bill would authorize the department, in lieu of requiring the analysis of alternatives, following public notice and an opportunity for all interested parties to comment, to instead rely on all or part of one or more publicly available analyses of alternatives to the chemical of concern under consideration, in existence at the time of consideration, and to proceed directly to a regulatory response.

Status: Pending in Assembly policy committee

SB 458 (Durazo) – Pesticides
This bill would prohibit the use of a pesticide that contains the active ingredient chlorpyrifos. The bill would make this provision effective unless and until the director adopts control measures for chlorpyrifos and the Director of Environmental Health Hazard Assessment and the chairperson of the State Air Resources Board determine, by clear and convincing evidence, that those control measures will not result in neurodevelopmental or other harm to children after taking into account the potential effects of consuming food or water contaminated with chlorpyrifos that was used in compliance with those control measures, and will not negatively impact sensitive receptors, as defined.

Status: Held in Senate fiscal committee

SB 574 (Leyva) – Cosmetics
This bill would, commencing July 1, 2020, require a manufacturer of a cosmetic product sold in the state to disclose to the Division of Environmental and Occupational Disease Control a list of each fragrance ingredient or flavor ingredient that is included on a designated list and a list of each fragrance allergen that is present in the cosmetic product in specified concentrations.

Status: Pending in Assembly policy committee

SB 732 (Allen) –SCAQMD tax authority
This bill would authorize the south coast district board to impose a transactions and use tax within the boundaries of the south coast district with the moneys generated from the transactions and use tax to be used to supplement existing revenues being used for south coast district purposes, as specified.

Status: Held in Senate fiscal committee

The Legislature is scheduled to adjourn on September 13, and Governor Gavin Newsom will have 30 days to act on measures sent to him by that date. We’ll check back after final actions take place on these and other measures.

California Just Passed

California Just Passed a $215 Billion Budget. Here’s What’s Between the Lines.

CALmatters reporters Matt Levin, Felicia Mello and Laurel Rosenhall contributed to this report.

Despite speculation about bold moves—in a far left direction, even for this blue state—Gov. Gavin Newsom and legislative Democrats actually landed a budget Thursday that’s surgical about new taxing while still keeping promises to help poor Californians and working families.

Under the $214.8 billion spending plan, the state inched closer to universal health coverage, expanding Medi-Cal to all low-income young adults regardless of immigration status. State lawmakers also charted a course to increase tax credits to the working poor and boost subsidies to middle-income Californians to buy health coverage. There were significant investments in early education and housing, also, while a portion of the surplus was.

But while Democrats began the year with a surplus of ideas for taxing Californians, only a few strategic levies survived the negotiation process, specifically a fine on individuals who don’t have health insurance under a state mandate. There’s even a little tax relief: Parents, for instance, will get a temporary tax exemption on diapers.

One hitch? The devil is in the details, some which have yet to be worked out. Though Democrats met their deadline for a balanced spending plan, most of the underlying policy to enact the budget wasn’t taken up—and may not be for weeks. Call it a learning curve: This was the new governor’s first time negotiating with seasoned legislative leaders who know how to count votes. Look for more action in coming trailer bills.

Here’s what you need to know about California’s new budget:
Yes to health care for undocumented young adults. Not yet on health care for all.

The Legislature agreed to the governor’s plan to expand Medi-Cal, the state’s Medicaid program for low-income people, to young adults ages 19-25. It’s a step toward offering free health care to all undocumented adults since the state already makes Medi-Cal available to children regardless of immigration status.

The Senate had proposed going further by offering Medi-Cal to undocumented seniors 65 and older. However, none of the leaders backed offering health care to all low-income immigrants.

The state expects an estimated 90,000 young adults could gain coverage when the benefit begins next year. Already, 76,000 have registered for a limited version of Medi-Cal that covers emergency services and prenatal care available to low-income people regardless of immigration status. The price tag for this expansion? About $98 million a year.

It’s worth noting the state also affirmed its commitment to restoring optional Medi-Cal benefits. During the recession, coverage for audiology, optical, podiatry, speech therapy and incontinence creams had been taken away.

Obamacare lives: A $695 state mandate to carry health coverage

Starting next year, California will join New Jersey, Vermont and the District of Columbia in requiring residents carry health coverage or face a $695 state penalty—a fine that will go up each year with inflation.

The state individual mandate aims to replace the federal one that Republicans repealed in their effort to dismantle the Affordable Care Act. The administration says California needs to act because without a mandate, the number of Californians without coverage—10.4% in 2016—will go back up. Separately, a study conducted by the University of California estimated the uninsurance rate will rise to 12.9% by 2023, or 4.4 million people, without state action.

Money raised from the penalties, about $1 billion over three years, will be used to give bigger subsidies to those who purchase private insurance through the state’s health coverage exchange, Covered California.

Newsom and lawmakers hope to expand assistance to 190,000 middle-income Californians making between $48,000 to $72,000 a year, according to Health Access California, a health advocacy group.

Fear of recall = Not many new taxes

The budget includes a plan to impose a fee—that still needs to be voted on—of no more than 80 cents a month on each telephone line to help digitize the state’s 911 system, which is still analog. The next generation system would improve call delivery, better location data and incoming text capability.

Other than that and the health care mandate, lawmakers opted against most of the new taxes proposed early in the session. In fact, California parents and women will get a sales tax exemption on diapers and menstrual products (though only for two years).

Notably rejected, given the state’s current $21.5 billion surplus, was Newsom’s push for a 95-cent tax on most residential water bills to fund clean drinking water initiatives in the Central Valley. Instead, the Legislature worked out a deal to clean up toxic water by diverting money generated from big polluters under the state’s cap and trade program.

Some environmental groups questioned using clean air money to pay for drinking water, but supporters reasoned that water is being contaminated with arsenic and other toxic chemicals from the heavy use of fertilizers so it makes sense to draw the $100 million for cleanup from the agriculture industry’s portion of the greenhouse gas fund.

One issue that won’t be resolved this week is whether California will conform its tax code to match federal changes made by Republicans in 2017. Newsom is relying on the projected $1.7 billion increase in net revenue from that to expand the state’s earned income tax credit, the centerpiece of his anti-poverty agenda.

Assembly Democrats in swing districts are skittish about limiting deductions and losses that can be claimed by some businesses. They know the fate of former Sen. Josh Newman, who was recalled from his Orange County seat after voting to raise California’s gas tax. Tax conformity requires a two-thirds vote in the Legislature to pass, so the pressure is on.

Newsom’s best Jerry Brown: Paying debt and rainy day saving

Lawmakers embraced the governor’s proposal to use some of the surplus to make extra pension payments, a step Newsom says is necessary to tame the state’s $256 billion retirement liability for state workers and teachers.

The Legislature approved supplemental payments of $3 billion to the California Public Employees’ Retirement System and $1.1 billion to the California State Teachers’ Retirement System for the state’s portion of unfunded liability.

To relieve school districts across the state, the Legislature will contribute a total of $3.15 billion toward paying down their liabilities and reducing their payroll contribution rates. One difference is where it will go.

Previously, Newsom had all the extra payments going to the teachers pension fund—a reaction, in part, to teachers strikes that erupted as he took office. Now a portion of that money will be doled out to CalPERS. The change was made in recognition that while teachers are members of CalSTRS, many other school employees from janitors to bus drivers belong in the state’s other public employee pension fund.

Besides paying down California’s “wall of debt,” as former Gov. Jerry Brown called it, the state is shoring up for a downturn—or in Newsom-speak, “building budget resiliency.” The new budget carries a roughly $20 billion reserve from several rainy day funds. This amount, while hefty, would be easily wiped away in a downturn. According to the Legislative Analyst’s Office, the state would need as much as $40 billion to cover the budget in a moderate recession.

Big spending on housing, but fight over where it goes

With new commitments topping $2 billion, the budget represents the most important action the governor has taken so far on housing and homelessness. The lion’s share will target the state’s homeless population, including $650 million in grants for cities and counties to build and maintain emergency shelters and $100 million for wrap-around care for the state’s most vulnerable residents. Another $500 million will go to quintuple the size of the state’s affordable housing financing fund, plus hundreds of millions earmarked for cities to update their often outdated housing plans.

While lawmakers and Newsom have agreed to cut big checks, it’s not clear who’ll get the money and with what strings attached. Big city mayors and lawmakers want homelessness grants directed towards the state’s largest 13 cities, while Newsom wants to spread out the money to include counties.

Newsom also wants to deny transportation funds to cities not building enough housing. As of Thursday, lawmakers were still negotiating a scaled-back version of the proposal. Another Newsom proposal that speeds construction of homeless shelters by sidestepping environmental laws also remains unresolved.

Lending a hand to working families

Expanding California’s earned income tax credit has quickly become one of Newsom’s signature anti-poverty programs because it gives a cost-of-living refund to low-income working families. Lawmakers are poised to triple the program from $400 million to $1.2 billion to provide a $1,000 refund for families with children under 6 and expand income eligibility from $24,950 to $30,000.

Anti-poverty advocates had wanted Newsom to include undocumented workers who file with individual taxpayer identification numbers instead of Social Security numbers. That proposal did not make the final version of the budget. Still, the administration estimates the current expansion will increase the number of beneficiaries from 2 million to 3 million households.

The budget also will make it easier for low-income families with children to qualify for assistance, increasing the CalWORKs asset limit to $10,000 and the motor vehicle exemption to $25,000—changes that will allow people to save and hang onto cars that can get them to work.

And parents of all incomes will get a longer paid family leave to care for new babies—8 weeks, up from the current 6 weeks, starting in July of next year. The goal will be to boost the benefit to 90% of most wages, up from the current maximum of 70%.

The K-14 kids did all right

As required by law, the lion’s share of the budget goes to public schools, with nearly $102 billion in state money to be pumped into California classrooms and community colleges, plus another $389 million in a special reserve fund for schools. Though the figure is an all-time high, California is still viewed as lagging in per pupil spending, in part because of the high cost of living.

Democrats are also demanding more stringent oversight of charter schools, which can operate like private schools, tend to be non-union and have proliferated in big cities such as Oakland and Los Angeles. Newsom proposed prohibiting charter schools from blocking or disenrolling special education students who require more support for disabilities. Lawmakers readily embraced that change.

The budget includes $300 million to build more kindergarten classrooms in an effort to boost full-day kindergarten programs. Newsom had initially proposed $750 million but that was reduced after a study found most part-day kindergarten programs are in wealthier communities.

After-school programs will get a $50 million boost to the $600 million or so the state is currently spending. The money will help cover the cost of minimum wage increases enacted during Brown’s tenure.

So did the little ones
In emphasizing early education, Newsom and lawmakers agreed to expand day care and preschool slots by the thousands while investing in training for child care providers.

Newsom gets $50 million in seed money to start child savings accounts for college and post-secondary education. He initially asked that all of it go toward pilot projects with First 5 California and local governments but the Legislature is designating $25 million. The other $25 million will create a state program with the Scholarshare program in the Treasurer’s Office.

More free college and help for student parents

Newsom and legislators delivered on a $45 million promise to fund a second year of tuition-free community college for first-time, full-time students at campuses participating in the state’s College Promise program.

Other big winners include students with children, who will be eligible to receive grants of up to $6,000 to help cover their families’ living expenses. The budget boosts by about 15,000 the number of competitive Cal Grants—a significant jump, but far less than the 400,000 qualified students who applied for the state scholarships last year and didn’t receive them.

The University of California and California State University will receive money to increase enrollment, and waive tuition during the summer to help low-income students graduate faster. Lawmakers also set aside funds for campuses to combat hunger and homelessness, strengthen veterans resource centers, and provide more mental health counseling. A center at the University of California San Francisco is getting a $3.5 million earmark for dyslexia screening and early intervention.

Backers of the state’s controversial new online community college fended off an effort to slash the college’s funding, clearing the way to enroll its first class this fall. And CSU will get $4 million to study five possible locations for a new campus: Stockton, Chula Vista, San Mateo, Concord and Palm Desert.

Lots for police training, a little for police records

Reflecting the Legislature’s focus this year on reducing police shootings, the budget includes $20 million to train police officers on de-escalation tactics and how and when to use force. Outside the budget, bills to set a tougher standard for police to use deadly force and require more officer training are advancing through the Legislature, reflecting a compromise between civil rights advocates and law enforcement groups.

Attorney General Xavier Becerra’s office will get $155,000 to implement the new state law he’d been resisting: making law enforcement misconduct records public. Becerra will also have to report to the Legislature on how many requests his office processes and how much time is spent on that. A judge ruled in May that Becerra must produce the records; previously he had said he would not release them until the courts clarified whether he had to.

Powering down to cope with wildfires

Besides beefing up the state’s firefighting capability and disaster preparedness, California will add powering down to its to-do list for coping with climate change-driven wildfires.

The budget doles out $75 million to state and local agencies whenever investor-owned utilities decide to shut off electricity during red flag weather warnings. One note: The Assembly added language to track how the money is used.

June 10, 2019

Homeless Numbers Spike

Homeless Numbers Spike in Santa Clara County
Written by Matthew Green, KQED

The homeless populations in Alameda, San Francisco and Santa Clara counties grew considerably over the past two years, according to initial results from January’s point-in-time counts, released Thursday.

Alameda County reported the biggest increase — of 43% — since its last tally in 2017, with a total of 8,022 sheltered and unsheltered homeless people counted during a single day. That marks a jump of nearly 2,400 people in just two years.

In Santa Clara County, the home of Silicon Valley and one of the wealthiest regions in the country, homelessness grew by 31% since the 2017 count. The survey found more than 9,700 homeless people countywide, the largest unhoused population in the Bay Area. Of those, nearly 6,200 were located in San Jose, an increase of more than 1,800 in that city in two years.

In San Francisco, which has spent more than $300 million annually on a broad range of homeless prevention services, the increase was less dramatic, but striking nonetheless. The county reported a 17% uptick since its last single-night count, putting the homeless population at just over 8,000. That’s the highest it’s been since 2004, when then-Mayor Gavin Newsom launched an aggressive supportive housing effort to curb chronic homelessness.

On a more hopeful note, San Francisco and Santa Clara counties both reported dips in their veteran and youth homeless populations, although the decrease in youth homelessness was due, in part, to a change in survey methodology.

Although an imperfect measure, point-in-time homeless counts are mandated every two years by the U.S. Department of Housing and Urban Development, and the results have strong influence on local spending and policy decisions. In most counties, an army of volunteers are dispatched over the course of a single day or night (two days in Santa Clara) to tally every homeless person they see.

Most Bay Area counties will release final reports with more detailed results, including demographic information, later this summer.

Officials in the three counties said they were disappointed, though not surprised, with the latest findings, a grim reminder of the region’s severe shortage of affordable housing options.

“Obviously, we’re deeply saddened by these numbers. And we know we need to do better,” said Abigail Stewart-Kahn, an official for San Francisco’s Department of Homelessness and Supportive Housing. “We also know that, to put context around this, this is a regional crisis. … Mayor Breed is wisely proposing an increased investment in prevention and diversion, because for every one person that we exit from homelessness in San Francisco, three people are becoming newly homeless.”

Santa Clara County officials noted a similarly challenging ratio of people entering and exiting homelessness.

“We have the resources to help people — even at that ratio — with health issues, drug and alcohol issues,” said county Supervisor David Cortese. “What we don’t have is enough shelter.”

Cortese said he had just attended a ribbon cutting for a new low-income housing development in Sunnyvale, one that received 3,500 applications for just 66 units.

“So that’s really what we’re looking at out here,” he said. “As fast as we’re producing housing, we’re still behind by about a 50-to-1 ratio. That’s a gap that needs to close.”

Officials in Alameda County also placed the blame squarely on the high rate of displacement and a deep shortage of affordable housing.

“Unfortunately, it wasn’t a surprise,” said Doug Biggs, executive director of the Alameda Point Collaborative, a supportive-housing program. “For every two people becoming homeless, we only have the resources to be able to house one of them.”

A board member of EveryOne Home, the agency that conducted the county’s point-in-time survey, Biggs said the county spends roughly $100 million annually on supportive housing and other homeless prevention services, but noted that it needs to spend closer to three times that amount to get people off the street permanently and prevent more people from becoming homeless in the first place.

“I’m fearful people are going to look at the numbers [by] themselves and feel numb to it,” Biggs said. “You really need to look beyond the numbers and look at the people those numbers represent. It’s deplorable that we have 8,000 community members living out there.”

Hope McKenney contributed to this report.

Cup of Joe Good to Go

California Says Cup of Joe Good to Go
Written by Brian Melley, AP

LOS ANGELES (AP) — California officially gave its blessing to coffee Monday, declaring the beverage does not pose a “significant” cancer risk.

The rule, proposed a year ago by regulators, means coffee won’t have to carry ominous warnings that the beverage may be bad for you.
The state took the rare move after a Los Angeles judge found Starbucks Corp. and other companies failed to show that benefits from drinking coffee outweighed risks from a byproduct of the roasting process.

That ruling put the industry in jeopardy of hefty civil penalties and in the position of either developing a process to remove the chemical or warning consumers about the risk of cancer.

The chemical in question, acrylamide, is on a list that California says causes cancer, though other groups classify it as a “probable” carcinogen.

Under a law passed more than three decades ago by California voters, products that contain chemicals that cause cancer or birth defects must warn consumers about those risks.

The Office of Environmental Health Hazard Assessment, which implements the law, concluded there was no significant risk after a World Health Organization review of more than 1,000 studies and found inadequate evidence that coffee causes cancer. Further, it concluded coffee reduces the risk of some types of cancer.

“Coffee is a complex mixture of hundreds of chemicals that includes both carcinogens and anti-carcinogens,” said Sam Delson, a spokesman for the agency. “The overall effect of coffee consumption is not associated with any significant cancer risk.”

It was the first time the state has declared such a brew of chemicals safe despite the presence of carcinogens, Delson said.
The coffee industry cheered the rule.

“This is a great day for science and coffee lovers,” said William Murray, president and chief executive of the National Coffee Association USA. “With this news, coffee drinkers around the world can wake up and enjoy the smell and taste of their coffee without hesitation.”

The Council for Education and Research on Toxics, which successfully sued the coffee industry in a case that has dragged on more than eight years in Los Angeles Superior Court, will challenge the validity of the state’s regulation in court, said attorney Raphael Metzger.

Metzger, who represents the small nonprofit in its lawsuit against Starbucks and about 90 coffee companies, said the regulation was adopted in violation of state law and disregards the statutes the agency is supposed to implement. He said the regulation can’t be applied retroactively to nullify the judge’s ruling.

California Companies Find Greener Pastures

California Companies Find Greener Pastures… Elsewhere

Written by Joseph Vranich, Fox and Hounds

If your business is in California and you’re wondering if companies continue to leave the state, the answer is, “Yes, and anecdotal evidence is that the numbers are growing.”

Before I identify the latest companies to depart California – 24 of them, which I’ve learned about only within the last three months – consider the deterioration in the once-golden state.

California continues to lose companies because of the state’s miserable treatment of businesses and the continued lowering of the quality of life in San Francisco and Los Angeles – parts of those cities have declined into squalor, which is spreading into other communities.

Every time a company departs the state, or does a U-turn and abandons its plan to move to California, the state loses capital investment projects, future tax revenues and jobs. Winning states have lower taxes, sensible regulations, reasonable energy costs and a better quality of life.

Business-flight appears to have gotten worse since I issued my recent report, “Why Companies Leave California”, which found that at least 13,000 companies moved out of state during the 2008-2016 period (the latest available figures). The cost: $76.7 billion in capital was diverted out of California along with 275,000 Jobs – and companies acquired at least 133 million square feet of space elsewhere. All of those findings are greatly understated because relevant information often went unreported in source materials.

Departures are understandable when year after year CEOs nationwide surveyed by Chief Executive Magazine have declared California the worst state in which to do business. The state has a high-cost business tax climate, with the Tax Foundation in 2019 ranking California at No. 49 – the second worst in the nation, ahead of only New Jersey.

Three previous California Governors – Gray Davis, Pete Wilson and George Deukmejian – cited findings from an earlier edition of my out-of-California report when expressing concerns about companies shifting their activities and expanding their operations out of state.

California’s current crop of politicians point to the occasional economic development “win” with pride while ignoring the overall business migration to other states. Let’s be candid about who they are – business-hostile Democrats who’ve never run a business, never raised capital, never built a building, never met a payroll, never arranged for employee health-care policies, never sold a product or service, never competed with lower-priced foreign competitors, and never paid any of the countless taxes and fees imposed by various levels of government.

It’s worth noting that the facilities most often relocated out of state are company headquarters, which means numerous high-paying jobs move elsewhere.

With that, the most recent business disinvestment events that I’ve learned about are as follows:

Aeromax Industries, an aircraft parts manufacturer, is relocating its headquarters from Canoga Park in Los Angeles to Texas. “After looking at a few other locations, Fort Worth made perfect sense for us,” said Tom Brizes, chairman and president of Aeromax. “It’s an aerospace-friendly community with many local companies that we’ve been doing business with for years. With no state income tax and reasonable fuel and property prices, we look forward to moving and growing our operation here.” Some California politicians claim that only low-paying jobs are moving to other states, but this company’s departure is but one of many that involve high-paying jobs. The company has more than 30 years of technical experience in advanced manufacturing. Relocation should conclude by September 2019. Operations will include management, shipping and receiving, aerospace engineering, marketing and administrative.

Apple Inc., based in Cupertino (Santa Clara County), selected Austin, Texas as the location for its new $1 billion, 133-acre corporate campus that will create up to 5,000 new jobs in the short term and add up to 15,000 once the site is built out. The campus expands the Apple footprint in Austin, already its biggest corporate presence outside of Cupertino. The new campus will be located less than one mile from an existing Apple campus. The influx of additional jobs is expected to make Apple the largest private employer in Austin. Jobs created at the new Apple campus will include engineering, R&D, operations, finance, sales and customer support. Tim Cook, Apple’s CEO, said, “Talent, creativity and tomorrow’s breakthrough ideas aren’t limited by region or ZIP code, and, with this new expansion, we’re redoubling our commitment to cultivating the high-tech sector and workforce nationwide.”

Apple, Inc. has only 1 data center in its home state but is building and expanding them in Iowa, North Carolina, Arizona & Nevada in a five-year, $10-billion plan. A big factor in choosing locations is that electricity costs can be up to 60 percent lower in other states. The $10 billion includes the cost of a new data center in Waukee, Iowa. No jobs number reported.

Berkley International, a custom molded fiber packaging company, is relocating manufacturing from Los Angeles to Reno, Nevada. “We use quite a bit of water, power and gas in our process, along with quite a bit of labor doing assembly for displays, and when you take those four pieces of business and look at cost structure in California versus the state of Nevada, along with the location of Reno, it was a very, very simple decision for us,” said company founder Jeff Berkley. The Inc. Magazine 5000 list ranked Berkley International as the 17th fastest growing company and 1 Manufacturer in America in 2016. The company was also named the fastest growing private company in Los Angeles for 2016 by the Los Angeles Business Journal. On May 17, the company held its groundbreaking at Tahoe Reno Industrial Center.

Blue Buffalo, an all-natural dog & cat food maker – here we should say “avoiding California – leased 540,000 square feet in Goodyear, Arizona, near Phoenix. The location won out over a number of unknown markets in California due in part to affordable housing, according to a commercial real estate agent representing the company.

Chatsworth Products (CPI), provider of information and communications technology (ICT) infrastructure products, opened its new Electronics & Software Technology Center not in its home base of Agoura Hills (Los Angeles County) but in Round Rock, Texas. The state-of-the-art, 34,000 square foot facility will allow CPI to have a dedicated location for the research, development, testing and manufacturing of the company’s intelligent power management solutions. The new center “will provide the manufacturing footprint for CPI to support the anticipated growth rates over the next five years,” says Ted Behrens, CPI’s Executive Vice President of Global Engineering, Product Management and Marketing.

Checkr, an artificial intelligence firm located in San Francisco, will open a large facility in Denver, Colorado and create 1,500 “high quality” jobs. CEO and co-founder Daniel Yanisse said the company wouldn’t be able to grow as it needed in the Bay Area where the median price of a home is above $1.3 million, more than triple the metro Denver cost.

Core-Mark Holding Co., a company that distributes fresh products to convenience stores and others, is relocating its San Francisco headquarters to Westlake within the Dallas-Fort Worth area in 2019 to better meet company growth. CEO Scott McPherson said, “The cost of operating out of the San Francisco Bay Area is high and while San Francisco is our long time home, the business has expanded dramatically over the years.” Dallas offers a better operating cost, lower taxes and is a central location for what is now a nationwide business. With more than 8,400 employees, Core-Mark already has a small office in Fort Worth, a data center in Plano and a distribution center in the San Antonio area. Core-Mark traces its roots to a San Francisco tobacco shop in 1888. Today, it serves 45,000 customer locations in the U.S. and Canada, including convenience stores, grocers, drug, big box and supercenter stores, liquor stores and specialty stores.

Crocs, a non-athletic footwear company, is another business relocating a facility to another state. The company will move its North American distribution operation to Dayton, Ohio from Ontario (San Bernardino County) to Dayton Ohio. The new Crocs facility is 40% larger than its California site and is where the company will hire 130 full-time employees. “When we looked at their workforces, their ability to draw on talent, we felt like the geographic location and then the talent within the market seemed to be a fit for our growing business,” said Shannon Sisler, Crocs senior vice president of global human resources.

Diamond WTG, a wind turbine engineering firm and unit of Mitsubishi, is relocating its headquarters from Newport Beach (Orange County) to Oregon. Diamond has been in the process of moving its offices to Portland since 2017 and completed the transition in early 2019.

DJO, a global provider of medical technologies, relocated its global headquarters from Carlsbad (San Diego County) to Lewisville, Texas, near Dallas. In addition to the relocation of many employees to the new headquarters, DJO is creating hundreds of new job opportunities in the Dallas area, including many at its new distribution center in Fort Worth which opened a few months ago and already employs over 200. “We made the strategic decision to move our headquarters to Dallas to expand our presence into a market with a strong and larger pool of talent, gain greater and more efficient customer access and take advantage of what we believe is a better corporate environment for our company as we grow,” said Brady Shirley, DJO’s President and CEO. Some work will remain in Carlsbad. After the relocation was announced, DJO was acquired for $3.15 billion by Colfax Corp.

EnerBlu Inc., a lithium battery maker, is relocating its headquarters and R&D from Riverside (Riverside County) to Lexington, Kentucky. The company is creating more than 100 new STEM jobs as it prepares to open its Lexington R&D center. Constructing a new manufacturing plant in nearby Pikeville, Ky. apparently is awaiting re-financing.

Fox Factory, a racing vehicle component maker, will move its headquarters from Scotts Valley (Santa Cruz County) to Hall County, Georgia by the end of 2018. The company will purchase of a 23-acre site where it will house new manufacturing, warehouse, distribution and office space. The first phase is expected to be completed by early 2020. Over the next five years, Fox expects to invest $50 million in the site and employ up to 800 workers. The company makes shock absorbers and suspensions for bicycles, motorcycles, off-road vehicles and snowmobiles; the new facility would provide additional capacity for growth in its powered vehicles group. Also, Fox also intends to shift aftermarket bike products operations from Scotts Valley and nearby Watsonville (Santa Cruz County) to Reno, Nevada. Fox CEO Larry Enterline said the decisions resulted from “extensive research” by the company and would allow it to “better support the needs of our growing business over the next several years.”

Google like most California-based digital companies built a new data center out of state. The latest, a $600 million facility, is in Clark County, Nevada, specifically Henderson, Nevada. Google will run the data center while its subsidiary, Design LLC, will own the property. Last year, for another project Google bought 1,210 acres of land at the Tahoe-Reno Industrial Center for $29.1 million. Google’s actions aren’t surprising because high-tech firms can be stung by California’s electricity costs, which are among the highest in the nation and continue to rise because of carbon emissions-related cap-and-trade costs and policies that restrict generation of electricity. When the time comes for these companies to build data centers – which rely quite heavily on electricity – states with lower electricity costs have a significant advantage.

Latexco US, a Belgium-based manufacturer of latex foam and mattress products, is moving operations from Santa Fe Springs (Los Angeles County) to Phoenix an 88,000-square-foot facility in southwest Phoenix to accommodate company growth. Upon evaluating their customer base, Latexco found that relocating to the region would provide significant opportunity. The noted the region’s business-friendly attitude, high energy and dynamic atmosphere as well as its talent pool. With 40 jobs, the Phoenix facility will serve as a hub for Latexco’s fulfillment services and cutting-edge advanced manufacturing facility.

Lottery.com, the digital lottery provider, moved its headquarters from San Francisco to Austin, Texas. Also, the company recently opened operations facilities in Dallas and Waco and has plans to expand across the state. CEO Tony DiMatteo said in a written statement. “We have big plans in this state, as well as for expansion both domestically and internationally.” A company spokesperson gushed about the Lone Star State even more, saying that “Texas’s low cost of living, unbeatable tax rates, and friendly business environment made it a clear frontrunner in Lottery.com’s decision to relocate its headquarters to Austin.” Lottery.com is a unit of Autolotto, Inc.

McKesson Corp., currently ranked 6th on the Fortune 500, is a global provider of healthcare supply chain management solutions, retail pharmacy, community oncology and specialty care, and healthcare information technology. It is relocating corporate headquarters from San Francisco to the Las Colinas section of Irving, Texas. expanding upon its presence in the Dallas area. John H. Hammergren, chairman and chief executive officer, McKesson Corporation. “Making this move will improve efficiency, collaboration and cost-competitiveness, while providing an exceptional work environment for our employees.” McKesson’s Las Colinas campus is already a key hub for the company. Employees at the North Texas location perform vital functions for the company in areas such as operations, information technology, finance and accounting, marketing and sales, administration and support, purchasing, and project management. San Francisco-based employees are being offered the opportunity to relocate to Las Colinas and other hub locations. The move should be completed by January 1, 2021.

Milestone Technologies, Inc., a managed service provider based in Fremont (Alameda County), will create at least 100 new jobs in Arizona, in east Phoenix. Milestone’s new Artificial Intelligence & Automation Center of Excellence will also be located on the site, not in Silicon Valley. The company provides advanced business services and IT support for international corporate clients. Milestone uses technology to make IT infrastructures smarter and streamlined. “The opening will facilitate expansion outside of its Silicon Valley home in order to meet the growing demands of our global customers,” said Nelson Eng, President & CEO of Milestone Technologies, Inc.

Parsons Co., an engineering firm, moved its headquarters from Pasadena (Los Angeles County), where it’s been for 45 years, to Centreville, Virginia. Chairman and CEO Chuck Harrington, who has traditionally split his time between Pasadena and Charlotte, N.C., will now shift between Charlotte and Centreville. The company said it wanted to be closer to its government customers, which makes sense, but failed to identify any cost savings to the business as well as substantial income tax savings to the well-compensated executives who relocate.

rfXcel, a software company, moved its corporate headquarters from San Ramon (Contra Costa County) to Reno, bringing 200 jobs to Northern Nevada with an average salary of $100,000. For years the company had been looking to relocate to a city with a lower cost of living, a high quality of life, and a growing technology sector. Glenn Abood, founder and CEO said, “This has been something that we’ve been working on for a while in terms of where we wanted to relocate, and we finally found the place.” The company will hire in many areas, including software engineering, technical support, sales and marketing, accounting, human resources and more. rfXcel’s technology optimizes supply chain operations with serialization software, regulatory compliance management, supply chain visibility software and Internet of Things (IoT) monitoring. Their technology enables products and goods to reach consumers without the threat of contamination, adulteration or diversion.

SpaceX will no longer build its Mars spaceship and rocket booster system at the Port of Los Angeles but will move the work to Boca Chica, Texas. It’s a reversal of a deal Los Angeles officials had touted as a win for the area. SpaceX initially leased about eight acres at the Port of L.A. that it used for recovery of Falcon 9 first-stage boosters and Dragon capsules, which arrive at shore via droneships. A new deal, approved last year, would have given SpaceX use of a 19-acre site on Terminal Island for an initial 10-year lease at the port with two additional 10-year extension options. Last year, SpaceX told the L.A. Board of Harbor Commissioners that production and fabrication of the Mars rocket could begin there in two to three years. But in a letter dated Jan. 7, SpaceX Chief Financial Officer Bret Johnsen said the company would terminate the Terminal Island lease agreement. Space X will continue other activities at its Hawthorne and Vandenberg Air Force Base facilities.

The Icee Co., a frozen drinks brand with revenue estimated at $350 million, is moving its headquarters from Ontario (San Bernardino County) to La Vergne, Tennessee, near Nashville. The company will invest $10.3 million to make the move, creating more than 200 jobs in Rutherford County over the next five years. Icee is a subsidiary of New Jersey-based J&J Snack Foods Corp.

Zoho, an international software company, is moving its headquarters from Pleasanton (in Alameda County) to Austin, Texas where it will open an office on a 375-acre campus. Executives said up to 500 employees will eventually fill a 100,000-square-foot building the company is planning to open in 2021. According to Zoho executive Raju Vegesna, as the company prepared for more growth, the firm began looking for a central location with lower costs for business operations and living, but one that had an attractive talent pool of workers and high quality of life for employees. “One of the things we value is quality of life for employees,” Vegesna said.

Many more California business exits can be found in “Why Companies Leave California” which in 2019 has been given recognition by The Wall Street Journal, Investor’s Business Daily, Forbes and countless local media outlets. The exposure is due in part to the report’s clarity about the top ten states that gained the most from California migrations. They are: (1) Texas – the most popular destination, a distinction it has held for at least a decade – (2) Nevada, (3) Arizona, (4) Colorado, (5T) Oregon, (5T) Washington, (7) North Carolina, (8) Florida, (9) Georgia and (10) Virginia.

The report’s painstaking research identifies departing companies by name and tells their stories; categorizes companies by industry; specifies which municipality and county in California they left; ranks business costs for utilities, workers’ compensation and other factors; and quotes what company leaders have said about their motivations for disinvesting in California.

1 Billion Acres at Risk

1 Billion Acres at Risk For Catastrophic Wildfires

Written by Kirk Siegler, NPR

The chief of the U.S. Forest Service is warning that a billion acres of land across America are at risk of catastrophic wildfires like last fall’s deadly Camp Fire that destroyed most of Paradise, California.

As we head into summer, with smoke already drifting into the Northwest from wildfires in Alberta, Canada, Vicki Christiansen said wildfires are now a year-round phenomenon. She pointed to the hazardous conditions in forests that result from a history of suppression of wildfires, rampant home development in high-risk places and the changing climate.

“When you look nationwide there’s not any place that we’re really at a fire season. Fire season is not an appropriate term anymore,” Christiansen said in an interview with NPR at the agency’s headquarters in Washington.

Christiansen’s agency is the nation’s lead firefighting apparatus. It’s trying to prioritize treatments such as thinning, brush clearing and prescribed burning on 80 million acres of its own land, mostly in the West. (Her billion acre estimate includes land across multiple federal, state and local jurisdictions as well as private land.)

“Our national priority is to improve the condition of our nation’s forests and grasslands,” Christiansen said.

In line with a controversial Trump administration executive order pushing for “active forest management,” the agency was directed to treat 3.5 million acres this year alone, though it’s behind target because of weather and administrative holdups. Part of the administration policy has also included an attempt to ramp up commercial logging on federal lands, an objective that conservation groups say will not reduce fire risk, unlike clearing of the smaller diameter wood that the timber industry has so far found little market for.

Christiansen defends what she calls an all-of-the-above approach.

“We are certainly focused on the timber outputs, but that is only one of the critical measures,” she says. “We are tracking with laser focus our hazardous fuels reduction and our watershed health and restoration as well.”

Christiansen’s comments follow one of the worst wildfire seasons in U.S. history last year. Wildfires in Northern California destroyed parts of whole cities and killed nearly 100 people.

Even with the push for more mitigation under Christiansen, the Forest Service is predicting it could spend upward of $2.5 billion just fighting fires this year alone. The agency was budgeted $1.7 billion and will likely again have to transfer money from existing forest management and fire mitigation programs to cover the difference, a paradoxical problem that won’t end until reforms kick in next year.

Biggest June Snowpack

California Sees Biggest June Snowpack in Nearly a Decade
Written by Hannah Fry, LA Times

During a weekend that’s widely known as the unofficial start of summer in California, visitors who trekked to Lake Tahoe for Memorial Day were met with a flurry of snowflakes that turned the landscape into a winter wonderland in May.

The storm responsible for the late-season snow in the Sierra Nevada town was one in a series of chilly spring systems that kept temperatures low following a marathon wet winter that filled reservoirs and streams and brought once-dry waterfalls back to life in the region.

Most importantly, the storms have maintained the snowpack — a key source of the state’s water supply — at its highest level for early June since 2011.

As of Monday, the snow blanketing the vast mountain range was 201% of average for the day — even larger than the snowpack on the same day in 2017, a banner year for precipitationthat pulled large swaths of Northern California out of persistent drought conditions.
As UCLA celebrates its centennial anniversary, now is an ideal time to assess the university’s relevance to humanity at large. Fortunately, that relevance is easily…
On June 3, 2017, the snowpack measured 187% of average, according to data compiled by the California Department of Water Resources.

In most years over the past decade, the snowpack had dwindled to tiny or nonexistent levels by June, diminished by rising spring temperatures that cause the accumulated snow to melt. At this time last year, it measured just 4% of average.

The last time a snowpack measured as large as this year’s on June 3 was in 2011, when it was 336% of normal for the day, data show.

“Typically this time of year, we don’t have a lot of snow, but this year we’ve continued to see rain, snow and mild conditions that have allowed the snowpack to remain,” said Chris Orrock, spokesman for the Department of Water Resources.

Though California saw significant precipitation in 2017, most of that rain was the result of warm atmospheric rivers, which created conditions that caused the snowpack to melt quickly during the spring season.

The atmospheric river storms the state experienced this year often were coupled with a cold front, which lowered temperatures and kept the snowpack intact longer. This could bode well for the state’s water supply, Orrock said.

The fact that the snow isn’t melting as quickly as it has in past years could allow reservoirs — most of which are nearing capacity from winter and spring rains — to take in more of the snowmelt without being forced to release large quantities of already stored water to make room.

“If it all melted rapidly with the reservoirs full, they’d have to release more water than we can use and we’d lose some of it,” Orrock said.

Currently, the snowpack has 15.6 inches of snow-water content, slightly above the water content for the same day in 2017. At this time last year, the snow-water content was less than an inch.

The Sierra snowpack is one of California’s most important water sources, providing about 30% of the annual fresh water supply for the state. Its spring and summer runoff feeds rivers and reservoirs and is eventually doled out to various water agencies for urban and agricultural use.

While a lush snowpack is beneficial, it also presents some hazards to downstream communities as it melts.

In preparation, water district managers are constantly coordinating how much water they’re planning to release from reservoirs into the state’s labyrinth of rivers, creeks, bypasses and canals. Since one reservoir’s release may meet with another, managers chart how much water rivers and levees can support before overflowing.

As the weather heats up over the coming weeks, officials say they are keeping a close eye on flood-prone areas like the narrow San Joaquin watershed, where rapid snowmelt in 2017 caused flooding in Yosemite National Park.

“There’s always a danger of flooding if we do get an extended hot period,” Orrock said. “We’re being vigilant and monitoring that.”

June 3, 2019

For Leaders Only

7 Ways Managers Motivate and Demotivate Employees
Article written by Travis Bradberry, Ph.D.

Few things are as costly and disruptive as managers who kill morale. Demotivated employees underperform and then walk out the door at the first opportunity.

The scariest thing is how prevalent this lack of motivation is. Gallup research shows that 70% of employees consider themselves to be disengaged at work.

Organizations know how important it is to have motivated, engaged employees, but most fail to hold managers accountable for making it happen.

When they don’t, the bottom line suffers.

Research from the University of California found that motivated employees were 31% more productive, had 37% higher sales, and were three times more creative than demotivated employees. They were also 87% less likely to quit, according to a Corporate Leadership Council study on over 50,000 people.

Gallup research shows that a mind-boggling 70% of an employee’s motivation is influenced by his or her manager. It’s no wonder employees don’t leave jobs; they leave managers.
Making Things Worse.

Before managers can start creating motivated, engaged employees, there are some critical things that they need to stop doing. What follows are some of the worst behaviors that managers need to eradicate from the workplace.

  1. Making a lot of stupid rules. Companies need to have rules—that’s a given—but they don’t have to be short sighted and lazy attempts at creating order. Whether it’s an overzealous attendance policy or taking employees’ frequent flier miles, even a couple of unnecessary rules can drive people crazy. When good employees feel like big brother is watching, they’ll find someplace else to work.
  2. Letting accomplishments go unrecognized. It’s easy to underestimate the power of a pat on the back, especially with top performers who are intrinsically motivated. Everyone likes kudos, none more so than those who work hard and give their all. Rewarding individual accomplishments shows that you’re paying attention. Managers need to communicate with their people to find out what makes them feel good (for some, it’s a raise; for others, it’s public recognition) and then to reward them for a job well done. With top performers, this will happen often if you’re doing it right.
  3. Hiring and promoting the wrong people. Good, hard-working employees want to work with like-minded professionals. When managers don’t do the hard work of hiring good people, it’s a major demotivator for those stuck working alongside them. Promoting the wrong people is even worse. When you work your tail off only to get passed over for a promotion that’s given to someone who glad-handed their way to the top, it’s a massive insult. No wonder it makes good people leave.
  4. Treating everyone equally. While this tactic works with school children, the workplace ought to function differently. Treating everyone equally shows your top performers that no matter how high they perform (and, typically, top performers are work horses), they will be treated the same as the bozo who does nothing more than punch the clock.
  5. Tolerating poor performance. It’s said that in jazz bands, the band is only as good as the worst player; no matter how great some members may be, everyone hears the worst player. The same goes for a company. When you permit weak links to exist without consequence, they drag everyone else down, especially your top performers.
  6. Going back on their commitments. Making promises to people places you on the fine line that lies between making them very happy and watching them walk out the door. When you uphold a commitment, you grow in the eyes of your employees because you prove yourself to be trustworthy and honorable (two very important qualities in a boss). But when you disregard your commitment, you come across as slimy, uncaring, and disrespectful. After all, if the boss doesn’t honor his or her commitments, why should everyone else?
  7. Being apathetic. More than half of people who leave their jobs do so because of their relationship with their boss. Smart companies make certain their managers know how to balance being professional with being human. These are the bosses who celebrate an employee’s success, empathize with those going through hard times, and challenge people, even when it hurts. Bosses who fail to really care will always have high turnover rates. It’s impossible to work for someone eight-plus hours a day when they aren’t personally involved and don’t care about anything other than your productivity.

Making Things Better

Once managers have eradicated the seven negative behaviors that demotivate their best people, it’s time to replace them with the following seven behaviors that make people love their jobs.

  1. Follow the platinum rule. The Golden Rule (treat others as you want to be treated) has a fatal flaw: it assumes that all people want to be treated the same way. It ignores the fact that people are motivated by vastly different things. One person loves public recognition, while another loathes being the center of attention. The Platinum Rule (treat others as they want to be treated) corrects that flaw. Good managers are great at reading other people, and they adjust their behavior and style accordingly.
  2. Be strong without being harsh. Strength is an important quality in a leader. People will wait to see if a leader is strong before they decide to follow his or her lead or not. People need courage in their leaders. They need someone who can make difficult decisions and watch over the good of the group. They need a leader who will stay the course when things get tough. People are far more likely to show strength themselves when their leader does the same. A lot of leaders mistake domineering, controlling, and otherwise harsh behavior for strength. They think that taking control and pushing people around will somehow inspire a loyal following. Strength isn’t something you can force on people; it’s something you earn by demonstrating it time and again in the face of adversity. Only then will people trust that they should follow you.
  3. Remember that communication is a two-way street. Many managers think that they’re great communicators, not realizing that they’re only communicating in one direction. Some pride themselves on being approachable and easily accessible, yet they don’t really hear the ideas that people share with them. Some managers don’t set goals or provide context for the things they ask people to do, and others never offer feedback, leaving people wondering if they’re more likely to get promoted or fired.
  4. Be a role model, not a preacher. Great leaders inspire trust and admiration through their actions, not just their words. Many leaders say that integrity is important to them, but great leaders walk their talk by demonstrating integrity every day. Harping on people all day long about the behavior you want to see has a tiny fraction of the impact you achieve by demonstrating that behavior yourself.
  5. Be transparent. Good managers are transparent and forthcoming about company goals, expectations, and plans. When managers try to sugarcoat, mask, or euphemize in order to make things seem better than they are, employees see right through it.
  6. Be humble. Few things kill motivation as quickly as a boss’s arrogance. Great bosses don’t act as though they’re better than you, because they don’t think that they’re better than you. Rather than being a source of prestige, they see their leadership position as bringing them additional accountability for serving those who follow them.
  7. Take a genuine interest in employees’ work-life balance. Nothing burns good employees out quite like overworking them. It’s so tempting to work your best people hard that managers frequently fall into this trap. Overworking good employees is perplexing to them; it makes them feel as if they’re being punished for their great performance. Overworking employees is also counterproductive. New research from Stanford shows that productivity per hour declines sharply when the workweek exceeds 50 hours, and productivity drops off so much after 55 hours that you don’t get anything out of the extra work.

Bringing It All Together

If you cultivate the characteristics above and avoid the demotivators, you’ll become the kind of boss that people remember for the rest of their careers.

Dr. Travis Bradberry is the award-winning coauthor of Emotional Intelligence 2.0 and the cofounder of TalentSmart® the world’s leading provider of emotional intelligence tests and training serving more than 75% of Fortune 500 companies. His bestselling books have been translated into 25 languages and are available in more than 150 countries.

Dr. Bradberry is a LinkedIn Influencer and a regular contributor to Forbes, Inc., Entrepreneur, The World Economic Forum, and The Huffington Post. He has written for, or been covered by, Newsweek, BusinessWeek, Fortune, Fast Company, USA Today, The Wall Street Journal, The Washington Post, and The Harvard Business Review.

250 Dogs Brought Their Humans...

250 Dogs Brought Their Humans to Fun Event

Mark Turner, President/CEO of Gilroy Chamber of Commerce

The Gilroy Chamber of Commerce held its inaugural, “Paws-in-the-Park” Pet Festival on Saturday, June 1 at Gavilan College. No bones about it, nearly 250 dogs put their humans on a leash and dragged them out for a day of fun. Approximately 500 humans attended the event and all seemed to have a dog-gone good time.

There were a number of demonstrations such as, Obedience Training with Primal Canine, Nosework with K-9 You, Gun Dog Training with Sundowners Kennels, Disc Throwing with BAD Dogs and Pet First-Aid with Silicon Valley Vet Services. One of the crowd favorites was the sheep herding demonstration with Glen McGowan. There was a doggie dress up contest and a best tail wag competition as well. Dogs and their humans participated in a Pet-Owner Look-Alike contest too.

Pet festival goers also enjoyed nearly 40 different vendors throughout the park offering various services including, pet photography, training services, veterinary services, pet sitting, local artists, adoption opportunities, non-profit organizations and the opportunity to receive a “Pet Blessing.”

We would be barking up the wrong tree if we didn’t take the time to thank our sponsors who helped make Paws-in-the-Park possible.

The feedback from attendees was very good. Everyone was as happy as a dog with two tails. The Gilroy Chamber staff and Board members are reviewing the comments and feedback looking to build upon next year’s Paws-in-the-Park event. These kinds of events help to build a strong local economy and promote the community. Thanks to all who attended and participated in this year’s event making it a success.

Whats New With Business

Eric Howard,  Business Relationship Manager

The Gilroy Chamber of Commerce is having their quarterly New Member Orientation Breakfast on Friday, June 21 at Old City Hall Restaurant from 7:45 – 9:00 am. This is open to new Chamber members or Chamber members who have never attended the New Member Orientation previously. Learn how to maximize your membership, get more in-depth information on ways the Chamber can assist your business or organization. You will hear from the Gilroy Chamber President, Mark Turner and staff about programs provided by the Chamber to make for a strong local economy. Sponsors of the New Member Breakfast are Lisa Blagof-Coldwell Banker and Vivian Investment Partners. Seats are limited. For more information contact Victoria Wright at 408-842-6437 or vwright@gilroy.org.

The United States Environmental Protection Agency (EPA), has selected the 2017-18 fifth grade class at Mount Madonna School to receive the President’s Environmental Youth Award for their work to protect humpback whales. The awards are presented each year to students and teachers who demonstrate creativity, innovation, and leadership to address difficult environmental challenges. “We’re proud to honor this special group of young leaders at Mount Madonna School who are promoting whale conservation,” said EPA Pacific Southwest Regional Administrator, Mike Stoker. Mr. Stoker went on to say, “These students are making a real difference by engaging their community, reducing plastic pollution, and teaching other students the importance of environmental stewardship. This class is an inspiring example of what’s possible when young students create solutions through passion and dedication.”

One Heart to Another is a non-profit whose mission is to empower young women to create change in the community. They believe by instilling a passion for community service in young women, it not only benefits our community but also makes the world a better place and builds strong leaders for the future. One Heart to Another runs five community service projects. They recently re-opened Cooper’s Closet at Christopher High School, which is a free boutique that provides clothing, backpacks, hygiene products and more to students. Enjoy a nice evening at, “A Night in the Vineyard,” at Hecker Pass Winery, on October 12, 2019 at 5:00 pm. You not only enjoy fine wine but help One Heart to Another’s fundraising efforts. Tickets can be purchased starting August 1. Go to Onehearttoanother.org and click the link to buy tickets or call Pamela McKenna at 408-497-4751.

Volunteer positions for the Gilroy Chamber of Commerce beer tents at the Garlic Festival are still available but going fast. There are several positions depending on your preference from I.D. checking to beer pouring to ticket selling. Shifts are approximately four hours. Volunteers get into the Garlic Festival, provided a meal ticket, two drink tickets and a Gilroy Garlic Festival Brew Crew tee-shirt. The Festival is Friday, Saturday and Sunday, July 26, 27 & 28. To sign-up go to https://www.signupgenius.com/go/5080D4EAAA728A3FD0-garlic2 or call the Chamber office at 408-842-6437.

Kylie Kuwada was crowned the 2019 Miss Gilroy Garlic Festival Queen at the annual scholarship pageant held on May 19. Queen Kylie and her court will represent the 41st annual Gilroy Garlic Festival at numerous pre-Festival activities and throughout the three days of the Festival, July 26, 27 and 28, 2019. The rest of the 2019 Royal Garlic Court includes First Runner-Up, Lilly Higgins; Second Runner-Up, Lauryn Longoria; Princesses Amaya Leyba-Guerra; Simran Sihra; Jenessa Andrade; Katie Van Horn; Brianna Budelli; Rae Ceballos; and Gisselle Oliveira. Over 120 people attended the pageant, which was held at New Hope Community Church in Gilroy and emceed by Andrea Yafai. Pageant judges included Ken Christopher; Stephanie Vegh; Dewey Lucero; Claudia Lucero; and Shay Matthews (Youth Judge).

South County Cal-SOAP announces its 4th annual signature fundraiser, AlumNight 2019. Join them as they celebrate another year of creating educated communities, one underrepresented student at a time. The event takes place at Solis Winery, 3920 Hecker Pass Road in Gilroy, on Thursday, June 27, from 6:00-8:30 pm. Tickets are $55 and include live music, local culinary delights, award-winning wines and a chance to win one of many drawing prizes. Special guests include Assemblyman Robert Rivas, Gavilan Board Trustee Edwin Diaz and the recipient of the Cal-SOAP Educator of the Year award, Dr. Blanca Arteaga. 100% of proceeds fund scholarships for college-bound Cal-SOAP students. For tickets go to: http://tinyurl.com/sccc-dollars4scholars or call 669-205-5470 or email southcountycalsoap@gmail.com

For the first time in its 41-year history, the Gilroy Garlic Festival is welcoming a Grammy Award-Winning, multi-platinum-selling singer/songwriter to perform live at the Festival. That singer is Colbie Caillat, who has sold over 10 million singles worldwide. She will appear with her new band, Gone West, on the Amphitheater Stage on Saturday, July 27. The concert starts at 6:00 pm and is included in the price of Festival admission. The grounds will remain open until 8:00 pm Saturday evening so guests can enjoy the show and everything the Festival has to offer. Gone West is a new Nashville-based band featuring two-time Grammy Award Winner Colbie Caillat, multi-platinum singer/songwriter Jason Reeves, four-time Hawaii Music Award Winner, Justin Kawika Young, and ACM and CMT nominated artist, Nelly Joy. The group debuted at the Grand Ole Opry in October 2018 and recently released a debut EP, Tides, through Grayscale Entertainment. To purchase discount tickets for the Festival online, go to gilroygarlicfestival.com.

California Has a Huge Surplus

California Has a Huge Surplus. So Why Are Legislators Still Trying to Raise Taxes?
Commentary written by Robert Gutierrez, President, California Tax Payers Association

With the state and local governments posting large revenue gains under the existing tax structure, there is absolutely no reason for lawmakers to consider changing the state constitution to increase the local tax burden.

But that is exactly what is happening.

Two tax increase measures have reached the floors of the Senate and Assembly. Both threaten to delete Proposition 13’s important taxpayer protections from the California Constitution.

The measures under consideration–Assembly Constitutional Amendment 1 and Senate Constitutional Amendment 5–could result in additional sales taxes, property parcel taxes, Mello-Roos taxes, phone taxes, cable taxes, business license taxes, payroll taxes, real estate sales transfer taxes, and hotel and lodging taxes.

Put simply, these measures are taxes on California affordability.

ACA 1, pending on the Assembly floor, would allow local governments to increase special taxes with a 55 percent vote of the electorate, instead of the currently required two-thirds vote, if the revenue is earmarked for “public infrastructure” or government housing projects.

“Public infrastructure” is broadly defined in the measure to include things like parks, open space, and expansion of Internet access.

SCA 5, on the Senate floor, would allow school districts and community college districts to increase property taxes with 55 percent voter approval, rather than the current two-thirds vote.

Public opinion polling consistently shows that voters support a two-thirds vote requirement for local taxes.

A March 2018 survey by the Public Policy Institute of California showed that across all demographics, voters support the two-thirds vote requirement. The poll found that the idea of changing the vote threshold is very unpopular among Democrats, Republicans and decline-to-state voters.

Considering that Gov. Gavin Newsom this month projected that the state will have $30 billion in reserves by the end of the 2019-20 fiscal year, and the Legislative Analyst’s Office says the state has an operating surplus of $22 billion, it is surprising that anyone is still talking about tax increases.

At the local level, property tax revenue has increased steadily over the years, by an average of 7.3% annually for business property and 6.34% annually for homeowner property since passage of Proposition 13 in 1978.

These increases ensure that communities have a stable, growing source of tax revenue even as individual property owners are protected from large year-to-year increases.

Statewide, the taxable value of property increased 6.5% in 2018-19. The legislative analyst projects that assessment rolls will continue to grow, with a statewide average increase of 6% in 2019-20 and another 5.6% in 2020-21.

It is worth noting that even under the two-thirds vote requirement, most tax measures are approved. So far this year, 12 two-thirds-vote measures have been on local ballots, and voters approved 11.

The high passage rate is partially attributable to the fact that proponents of tax measures are allowed to write the ballot questions, and many local governments use tax dollars for “educational outreach” designed to promote the tax.

For example, see the Los Angeles Unified School District’s brazen use of public resources to campaign for a parcel tax on the June 4 ballot. In this environment, it is especially important to maintain the two-thirds vote threshold.

A two-thirds vote requirement provides protection for taxpayers, without blocking tax increases that have strong community support. This is fair for government and taxpayers alike, and should not be stripped from the constitution.

Secrecy Abounds

Secrecy Abounds on State Budget, Major Bills

Commentary written by Dan Walters, CalMatters

Fair warning: By reading this you will be plunging into the Legislature’s almost impenetrably arcane thicket of internal procedures.

To begin at the beginning, for decades the state budget was written in secret by the chairmen of the Legislature’s two fiscal committees, Assembly Ways and Means and Senate Finance.

This clandestine process exploded in the 1970s during a larger battle over control of the state Senate and for more than a decade the state budget was fashioned more or less in public.

Eventually, however, the big decisions again moved behind closed doors and into private negotiations among what came to be known as the “Big 5” – the governor and the partisan leaders of both houses. More recently, Republican leaders have been excluded because the vote margin for budgets dropped from two-thirds to simple majorities and the GOP now has only a quarter of the Legislature’s seats. So now a “Big 3” makes the multi-billion-dollar decisions.

When the budget was handled largely by the Legislature’s two fiscal committees, they delayed action on legislation that would add money to the current budget, placing those bills in a “suspense file” until the financial parameters of the upcoming budget were settled – which made perfect sense.

By and by, however, legislative leaders divided the process, creating “budget committees” in both houses to work on the overall spending plan and “appropriations committees” whose sole function was to handle non-budget legislation with financial impacts, however slight.

However, it quickly morphed into a new way of conducting the public’s business in private. The appropriations committees became vehicles for deciding, without leaving fingerprints, which bills would advance to legislative floors and which would be buried.

Those chairing the appropriations committees would simply read the numbers of bills to be held or released for floor votes without explanation and it’s been obvious that the secret decisions had little or nothing to do with fiscal impacts and everything to do with political considerations of some kind.

This month’s version involved 721 Assembly bills and 355 in the Senate. Overall, nearly 70 percent were given the green light and the others simply died without explanation.

Not surprisingly, bills by the dominant Democrats generally fared better than those by the powerless Republicans and those being carried by the chairs of the two appropriations committees were especially blessed.

Lorena Gonzalez, a San Diego Democrat who heads the Assembly Appropriations Committee, released 15 of her own 16 bills to the floor – the most of any member, according to calculations by lobbyist Chris Micheli, who charts legislative data as a hobby.

The demise of one bill in Senate Appropriations was especially noteworthy – and inexplicable.

Its chairman, Anthony Portantino, axed Senate Bill 50, one of the year’s most important measures. It would set aside local zoning laws to allow high-density housing in “jobs-rich” and “transit-rich” communities, aimed at overcoming “not-in-my-backyard” opposition to housing projects, especially in affluent, cloistered cities.

Democrat Portantino happens to represent one of those cities, La Canada Flintridge, and to deepen the mystery, Senate President Pro Term Toni Atkins, a San Diego Democrat, said afterwards that she had nothing to do with the action and would have voted for SB 50, carried by Sen. Scott Wiener, a San Francisco Democrat.

So now we have a made-in-secret budget and secretive decisions on important legislation outside the budget, making it virtually impossible to hold anyone accountable for what does and does not happen. It’s just like the bad old days.

Power Outages to Avoid More Wildfires?

California Approves Power Outages to Avoid More Wildfires

Written by Don Thompson, AP News

SACRAMENTO, Calif. (AP) — California regulators on Thursday approved allowing utilities to cut off electricity to possibly hundreds of thousands of customers to avoid catastrophic wildfires like the one sparked by power lines last year that killed 85 people and largely destroyed the city of Paradise.

Utilities’ liability can reach billions of dollars, and after several years of devastating wildfires, they asked regulators to allow them to pull the plug when fire risk is extremely high. That’s mainly during periods of excessive winds and low humidity when vegetation is dried out and can easily ignite.

The California Public Utilities Commission gave the green light but said utilities must do a better job educating and notifying the public, particularly those with disabilities and others who are vulnerable, and ramp up preventive efforts, such as clearing brush and installing fire-resistant poles.

The plans could inconvenience hundreds of thousands of customers while endangering some who depend on electricity to keep them alive, like 56-year-old Kallithea Miller.

Although she lives far from wildfire danger near a shopping mall in Stockton, south of Sacramento, she relies on a refrigerator to cool her insulin and a machine to keep her breathing at night.

“I could die in my sleep,” she said. “It’s scaring the hell out of me.”

The precautionary outages could mean multiday blackouts for cities as large as San Francisco and San Jose, Northern California’s major power provider warned in a recent filing with the utilities commission.

Pacific Gas & Electric anticipates cutting the power only in “truly extreme fire danger weather” while recognizing that there “are safety risks on both sides of this issue,” vice president Aaron Johnson said.

PG&E initially planned to de-energize power lines in at-risk rural areas but has since expanded its plans to include high-voltage transmission lines like the one that sparked the nation’s deadliest wildfire in a century. The blaze last November killed 85 people while wiping out nearly 15,000 homes in and around Paradise.

“I know it inconveniences people, but it’s a small price to pay for not having the kind of devastation that we had in Paradise,” Mayor Jody Jones said. “Everyone I know in Paradise knew that PG&E might cut the power off. I didn’t see that as a problem. The problem was that they didn’t actually shut it off.”

Utility equipment has been blamed for many of California’s most destructive and deadly wildfires in recent years.

Other major California utilities have similar plans that commissioners unanimously approved Thursday, also warning that outages could extend into cities under some conditions.

“We’re worried about it because we could see people’s power shut off not for a day or two but potentially a week,” Gov. Gavin Newsom said as he recently called for California to spend $75 million to help communities prepare. “This is high winds, severe weather, turn off the electricity so it doesn’t ignite a fire. It’s a good thing — unless you’re impacted.”

California’s three largest investor-owned utilities serve more than 150,000 customers who rely on life-support equipment, many of whom are considered low income, state Sen. Bill Dodd said. The Democrat from Napa wants utilities to provide backup electricity or financial assistance so high-risk customers can buy generators or batteries.

The elderly, people with disabilities and language barriers, and poorer residents in remote areas with limited transportation or communication are also at greater risk. Cellphone networks can fail, computers and internet phone lines won’t work, traffic signals go dark and there can be problems with communication systems, water treatment facilities and emergency services.

Utility representatives said they are doing their best to work with emergency responders and community groups to warn vulnerable customers, as the Public Utilities Commission required.

“What the PUC can do is basically lay out the expectations for what the utilities need to do. Where the rubber meets the road is how the utilities operationalize, particularly on the notification,” said Mark Toney, executive director of the Utility Reform Network.

The option to pull the plug isn’t new, though state officials expect it to be used much more frequently.

San Diego Gas & Electric won permission to cut off power during high-risk conditions after its equipment ignited three big fires in 2007. State regulators expanded the shut-off requirements to other investor-owned utilities last year, after devastating fires in 2017.

Once power is shut off, the utilities must inspect every de-energized line before they restore power, a process that can keep the lights out for days even after conditions improve.

Both PG&E and Southern California Edison used their new authority last fall, with many residents and local officials upset that stores, businesses and schools had to close for lack of electricity.

Calistoga Mayor Chris Canning said his city of 5,200 residents in the Napa Valley was the first to experience a PG&E power outage, “so we learned firsthand how that goes — not well.”

He cited poor communication, which utility representatives said they are working to improve, but praised PG&E for now trying to keep makeshift power flowing to key areas of town in the next outage.

“They’re damned if they do, and damned if they don’t,” Canning said. “There’s only so much we can do as a city to protect you. Individual residents have to be prepared.”

Miller said her backup plan is a cat named Mojo who instinctively paws at her face whenever she stops breathing.

“It puts us in a dangerous situation and a stressful situation,” she said. “If they have a blackout that lasts for five days, I’m screwed.”

May 2019

The Land of Fruits and Nuts

Article by Kate Irby

U.S. Department of Agriculture Secretary Sonny Perdue announced Thursday that grapes, tree nuts and cranberries will be added to the list of crops that are eligible for direct payments from the federal government to compensate for losses in the trade war with China.

The new farm aid package, which will distribute $16 billion to farmers, up from the $12 billion given in aid last year, will distribute the assistance in three payments, with the first in July or August, according to the USDA. The second payment should be made in late fall and the third in early 2020.

“We hope to have a trade agreement before those second and third payments are made,” said USDA Undersecretary Bill Northey in a call to reporters on Thursday.

Farm aid is meant to help the growers who have been affected by retaliatory tariffs implemented by China against U.S. agricultural products.

What to Tax Next...

What Could the California Legislature Tax Next? I Know… Water!

Opinion Written by Jon Coupal, President of the Howard Jarvis Tax Payers Association and California Assemblymember Phillip Chen.

California has a record $21.5 billion surplus.

That’s the good news. The bad news is that we have all that money because you are being overtaxed.

Earlier this month, Governor Gavin Newsom released his revised budget proposal, the largest in California history.

At a staggering $214 billion dollars, the budget is larger than that of most nations and every other state.

The budget also includes a new $140 million tax on water customers to help all Californians have access to clean water.

Clean water is important, and there are a million people in the Central Valley without access to it. But do we need a new tax to pay for it? Maybe we don’t.

Just last week, a state Senate budget subcommittee eliminated Gov. Newsom’s recommendation for a water tax and replaced it with a $150 million continuous appropriation from the General Fund.

This ensures reliable funding for years to come without increasing taxes. Obviously, we will be watching carefully to ensure that these dollars are in the state budget expected to be signed into law next month.

A General Fund solution makes sense, especially considering that the state surplus is 1,529 times what is needed to cover the costs to ensure everyone has access to clean water. But even if this proposal doesn’t make the final budget, there are other alternative sources of revenue.

Over the last four years, voters have approved two separate statewide water bonds, each of which designate hundreds of millions of dollars specifically for clean water projects.

Why can’t the governor direct some of that money to clean water?

Why wasn’t that done already by previous administrations?

Why is it that, whenever the state misallocates our tax money, the taxpayers get hit again?

The tax could cost some Californians an additional $10 a month, at a time when families statewide are struggling to pay record-high gas prices and other costs for goods just to survive.

Californians are drowning in taxes and high costs.

It’s no wonder many are looking at moving to more affordable states such as Texas and Arizona.

A Quinnipiac University Poll from February 16 found 43 percent of California’s voters felt they couldn’t afford to live in the Golden State. Among voters 18 to 34 years old, 61 percent said they couldn’t afford to live here.

The great California exodus to other states is already underway and many experts are predicting the Golden State will lose one congressional seat after the 2020 U.S. Census.

This means lower representation for our state in Congress and fewer federal dollars to help pay for infrastructure projects, education and public safety.

Additionally, if we lose younger generations to other states due to high costs, there will be a “brain drain” that will impact every sector of industry in California.

We can, however, start changing course today by saying “no” to new taxes like the water tax, and instead work together to make the Golden State more affordable for all Californians.

New Taxes Necessary?

Are More and New Taxes Necessary?

Article by Loren Kaye, President of the California Foundation for Commerce and Education

Taxes continue to pour into the state treasury, like spring snowmelt into Lake Oroville. Thanks to the engine of California’s private economy—the creativity of business leaders and productivity of employees—and the wealth it creates, Governor Gavin Newsom last week announced that revenues exceeded earlier budget estimates by more than $3 billion, enabling him to propose bolstering reserves, paying down debt, and boosting education spending.

Californians have enjoyed nearly 10 years of economic growth, and one of the biggest beneficiaries has been the state budget. Since the depths of the recession, the state budget has increased by 82%—that’s more than $95 billion.

Compare that to the recession years when the Governor and Legislature were forced to cut tens of billions of dollars in spending.

Today, with a healthy budget and continuing prospects for growth, Governor Newsom has set aside $16.5 billion in a rainy-day reserve to hedge against the next economic downturn and continued to boost education spending.

In addition, he proposes spending more than $9 billion to pay down unfunded pension liabilities and pay off longstanding debts and deferrals.

Protecting Against Shortfalls

But what goes up inevitably will come down, and a key responsibility for a chief executive is to look to the future—not only to spread the blessings of prosperity but to protect against shortfalls.
When he released his revised budget proposal last week, Governor Newsom recognized this, insisting that “We need to have a structurally balanced budget because we are entering the end of the beginning of a new phase of economic reality. The headwinds are real.”

The precarious condition of state finances is well known. The top 1% of earners pays nearly half of all income taxes and these taxes provide 70% of all General Fund revenues. The Administration forecasts that a moderate recession would reduce state revenues by $70 billion over three years.

Savings Strategy

The Governor and the Legislature should continue to insist on a savings strategy pioneered by Governor Brown. Top up the budget reserve, reject new taxes, and resist demands to build into the budget new, ongoing spending that will be painful to unwind when the economy slows.
The easiest money to save for a rainy day is money you haven’t committed to ongoing programs.

The good news is that the extra revenues the state receives once the reserve fund is filled are directed to infrastructure, which can be used to help create high-paying jobs for skilled workers to improve and upgrade our highways, mass transit, public buildings and flood control facilities.
This has the three-fold benefit of providing mobility, safety and public services for residents, creating well-paying jobs for Californians, and budgeting responsibly for the fiscal health of the state.

No Need for Tax Hikes

The budget windfalls should also allay the calls for new or higher taxes, which have proliferated in the early days of the legislative session. The existing state corporate tax rate, combined with the effects from federal tax reform, resulted in a surge of more than a billion dollars of new revenues this year.

Only a few members of the current Legislature were in Sacramento during the last recession, so it may be understandable that many members call for increases in ongoing programs. But nobody wants to return to the bad-old-days of deep cuts to education and safety net programs.
We can help those in need if the private sector continues to thrive and generate tax revenue. Success of the private sector economy creates the foundation for a state budget that provides services to the people of California.

Seniors in the Workplace

Article by Dana Leisinger, HR Adviser, CalChamber

Our employee is over 65 years old and he seems shaky physically; it is taking him longer and longer to get his job duties done. Can we address his physical symptoms and/or ask him if he’s likely to retire soon?

Recent studies have shown that employees are retiring later in life for a number of reasons, primarily due to financial considerations.
Other older employees don’t want to retire due to other issues—loneliness, enjoying their job, having a sense of purpose, etc.

The question posed above is becoming more and more of an issue. Nevertheless, when an older worker shows physical signs of slowing down, the employer needs to stay focused on job performance concerns.

Job Performance

An employer should address the job performance consistently with all employees, noting the lack of productivity, absenteeism and tardiness.

If the employee brings up a physical condition that is causing the performance issues, another subject arises. Getting older is not a disability, but medical conditions caused by getting older may require the employer to accommodate the condition. This is when the employer and employee enter into the interactive process to discuss options from both sides.
It is very important to be specific about the job performance versus complaining that Employee A is “really slowing down”—older employees can be very sensitive to use of the word “slow.”

Beware of Ageism

Remember, both federal and state laws protect workers over age 40 from discrimination. Point out the specifics and suggest ways to improve the performance.

Any disciplinary action must be consistent with company policy and how you handle all employees. Follow-up is vital. If an employer has been specific in directions to employees, those employees, including older workers, can have much better success in improvement.

Communication is critical, and motivation is very helpful. By the time employees are in their 60s, advancement may not be important, but praise for a job well done can be very important.
Lastly, keep in mind that older employees can be great mentors for younger employees. Experience is a tremendous asset, and it is wise to remember the positive aspect of senior employees.

Column based on questions asked by callers on the Labor Law Helpline, a service to California Chamber of Commerce preferred and executive members. For expert explanations of labor laws and Cal/OSHA regulations, not legal counsel for specific situations, call (800) 348-2262 or submit your question at www.hrcalifornia.com.

Take a Stand and Let Your Voice Be Heard

Mark Turner, President/CEO, Gilroy Chamber of Commerce

The Gilroy Chamber of Commerce has now made it easier for you, our members, to let your voice be heard. Hundreds of bills each year come out of Sacramento. Many of those bills have unintended consequences that have the potential to negatively impact your business and the local economy.

The Chamber’s Government Relations Committee and the Chamber Board of Directors review bills and then take a position to support or oppose depending on the potential impact to our business community.

We are adding a service to our website that will allow you to participate. By clicking on the link in this article, you will be directed to the Gilroy Chamber’s Advocacy in Action page where you can read brief summaries of the bills we deem concerning or as a Job Killer. From there, you can follow some simple instructions and send a note to various elected officials indicating your personal support or opposition. We have made it very easy to engage in the process.

As one politician once said, “Elected officials will see the light when they begin to feel the heat.”

You can help turn up the heat and support legislation that helps our local economy and oppose legislation that doesn’t. The more people our elected officials hear from, the more our elected officials will do the right thing.

This is one more way the Gilroy Chamber of Commerce is helping to create a strong local economy, representing the interests of business with government and engaging in political action. If you have any questions regarding the Advocacy in Action page, contact us at 408-842-6437.

 

Gilroy EDC Promotes New Opportunity Zone

Tammy Brownlow, President/CEO Gilroy Economic Development Corporation

Opportunity Zones are a new tool communities can use to drive economic development. Established by the U.S. Congress in the Tax Cuts and Jobs Act of 2017, Opportunity Zones encourage long-term investments in low-income urban and rural communities across the United States. The zones themselves are comprised of low-income community census tracts and designated by governors in every state. To qualify, census tracts must have either poverty rates of at least 20 percent or median family incomes of no more than 80 percent of statewide or metropolitan area family income. California had 879 census tracts that were certified, two of which are within the City of Gilroy and include the downtown area.

This program provides a federal tax incentive for taxpayers who reinvest unrealized capital gains into “Opportunity Funds,” which are specialized vehicles dedicated to investing in low-income areas called “Opportunity Zones.” The funds can be used to finance commercial and industrial real estate, housing, infrastructure, and current or start-up businesses located in the Opportunity Zones. After several years in the Fund, some of the tax on investors’ initial profits (capital gains) will be forgiven. And, the longer investors leave their money in the Fund, the more capital gains tax will be waived. If held for a decade, the added profit made from the Opportunity Fund investment will not be taxed at all.

According to an analysis of the Federal Reserve’s Survey of Consumer Finances, U.S. households and corporations were sitting on an estimated $6.1 trillion in unrealized capital gains at the end of 2017. If even a portion of those gains are moved to invest in distressed communities, it could have a transformative impact.

The long-awaited Opportunity Zone regulatory clarification from the IRS arrived on April 17, which is expected to accelerate investment due to the clarifications and improvements. The new regulations add flexibility to the 31-month working capital safe harbor period for delays caused by government agency actions (such as permitting and CEQA reviews) for operating business investment and real property investment, provided the application to the local agency is completed within the 31-month period.

The Gilroy Economic Development Corporation (GEDC) is working with our partner the Gilroy Downtown Business Association to promote the Gilroy Opportunity Zone to potential investors. For more information on this program and a map of the qualifying census tracts in Gilroy, please contact the GEDC at 408-847-7611 or email president@gilroyedc.org.

California Senate Rejects Proposed Water Tax

 

SACRAMENTO — The California Senate has rejected a new tax on most residential water bills, opting instead to use existing tax dollars to improve drinking water in some of the state’s poorest areas.

State officials say in 2017, more than 450 public water systems did not comply with safety standards, affecting more than half a million people.

This year, Gov. Gavin Newsom proposed a 95-cent tax on most residential water bills. He wants to use the money to improve the drinking water systems.

Senate leaders rejected that proposal on Wednesday. Instead, they endorsed a plan that would use $150 million of existing taxpayer dollars to make the improvements.

The tax proposal is still alive in the state Assembly.

A spokesman for Newsom said the governor supports a permanent and sustained funding source.

Coalition Urges Lawmakers

Coalition Urges Lawmakers to Protect Independent Contractor Status
Many self-employed Californians don’t want to be reclassified as employees and lose their work flexibility.

Written by Kevin Smith, Southern California Newsgroup

A coalition of self-employed workers and business leaders are urging state lawmakers to expand a bill that would allow more independent contractors to be exempted from employee status.
At a press conference held Wednesday at the Pasadena Chamber of Commerce, the group said it’s seeking additional changes to Assembly Bill 5 by Assemblywoman Lorena Gonzalez, D-San Diego. The legislation exempts doctors, insurance agents, securities brokers and direct sellers (Mary Kay, Amway, etc.) from adhering to a 2018 California Supreme Court ruling that redefined what an independent contractor is.

The new rules

Under the court’s new “ABC” standards, a person or business is considered an independent contractor only if (A) they are free from the control and direction of an employer; (B) the work they perform falls outside the employer’s core business; (C) they have their own independent business or trade beyond the job for which they were hired.

Some of those seeking an expansion of AB 5 want a variety of other workers exempted, including rideshare drivers, dietary consultants, engineers, lawyers, therapists, hair stylists and others who have advanced degrees, are licensed by the state or simply want to remain independent contractors.

They have joined forces via the I’m Independent Coalition to have their voices heard in Sacramento. Many say they need job flexibility and additional income, and legislation will ensure their livelihoods are not taken away.

Representatives from Gonzalez’s office could not be reached Wednesday, but last month they said discussions regarding AB 5 are ongoing.

Personal stories

Jimmy Thompson, who spoke at Wednesday’s press conference, is among those seeking exemption from the court ruling. The 36-year-old South Pasadena resident is a Realtor who also works as a Lyft driver. The rideshare job allows him to earn extra cash without the rigid demands of being a company employee.

“The reason I like being independent is that I can choose my own schedule,” he said. “I see a house and can turn on from right there and drive for a couple hours. Rideshare drivers enjoy the flexibility of just turning on and turning off. There is no boss telling you when or where to be.”

Tina Kerrigan, a dietary consultant who provides contract service at skilled nursing facilities, assisted living homes and in residential care businesses throughout Southern California, feels the same way.
Independent contractors have been a staple of California’s dietetics industry for more than 50 years, she said.

“These skilled nursing facilities, assisted living homes and residential care businesses do not require a full-time or even part-time registered dietician employee,” Kerrigan said. “They often choose and prefer to have a consultant.”

Being reclassified as an employee, she said, would end her work flexibility and result in about a 30 percent drop in pay as she’d have fewer clients.

Flexibility and higher wages

Bill Manis, president and CEO of the San Gabriel Valley Economic Partnership, supports an expansion of AB 5.

“Our concern is that many Californians who choose to work as independent contractors do it because it suits their personal schedule,” he said. “It’s a career goal they have and it’s a lifestyle. They have the ability to negotiate compensation, work for multiple employers, earn more money or work part-time to care for things like their family.”

A recent survey, he said, found that nine out of 10 independent workers prefer freelancing over the typical employer/employee work model.

“By denying these contractors the chance to work independently, the Dynamex decision throws hundreds of thousands of Californians into limbo,” he said.

Last year’s California Supreme Court ruling dates back to 2004 when Dynamex, a package and documents delivery company, converted its drivers to independent contractors in a move to save money.

A few months later, a group of drivers sued, claiming they performed the same basic tasks in the same manner as when they were employees but without the protections of the California labor code and wage orders, which regulate wages, hours and working conditions.

In April 2018, the court ruled in favor of the drivers. But it based its decision on the newly created ABC standards that had never been used in the state.

Texting in the Workplace and other Cautionary Tales

Podcast Information provided by Erika Frank and Jennifer Shaw

Review Your Work Before Submittal

A Virginia information technology staffing agency made headlines recently for posting a job ad seeking “preferably Caucasian” candidates. In the podcast, Shaw mentions that in an effort to increase efficiency, many companies choose to use resume scanning software, and it is possible that this staffing agency simply made an error by checking a wrong box and not reviewing the final job announcement before it was published.

Why would race even be an option? Ninety-nine percent of the time, Shaw says, race is not relevant. However, there are isolated cases that allow for bona fide occupational qualifications (BFOQ), where race or ethnicity can be considered, such as when a worker is interacting with a refugee population and needs to have cultural or language rapport.

Although the Virginia staffing agency said it was upset by the job posting, both Frank and Shaw agree the response was not helpful.

“Employers need to fall on their sword when they make a mistake,” Shaw says.

No-Touch Workplace

Another recent article tackled how some employers are attempting to prevent workplace sexual harassment by banning all physical contact, including handshakes.

Frank and Shaw comment that cultural norms vary a great deal in American workplaces—especially in California. Nevertheless, there still is a sense of proper etiquette and “good manners,” they say. Although no one is expected to be a mind reader, common sense should prevail, Frank says.

“We have to be realistic as far as how far we’re going to go to try and prevent any unintended consequence from a potential handshake or inadvertent touch in the workplace,” Frank says.

Texting vs. Email

The last news item discussed in the podcast is a clash between technology and common sense: companies incorporating text messages into workplace communications. Quickly becoming the norm, texting in the workplace brings a host of problems and raises many legal questions. On the one hand, text messages often produce quicker responses, but this increases the number of mistakes that can be made. Texting may be convenient, but group texts and responses can inundate users. Furthermore, while auto correct is supposed to make spelling easier, it can create, and has created, many embarrassing situations, which are amplified in the workplace.

There also is a range of wage-and-hour requirements that employers need to be aware of—including reimbursing employees for the work-related text messages, which can be costly, Frank says. On top of all this, Shaw points out, texts between coworkers are still work-related communications and therefore phones can be subpoenaed.

“Texting is good for ‘Can you bring, you know, some milk home for dinner, honey,’ but it’s probably not good for much else in the business world,” Shaw says.

 

More Plans to Expand Paid Family Leave

Article by CalChamber

Following up on his January commitment to expanding California’s Paid Family Leave (PFL) program, Governor Gavin Newsom outlined steps toward that goal in the budget plan he released last week.

PFL, a component of the State Disability Insurance (SDI) program, currently allows workers to take up to six weeks of paid leave annually to care for a seriously ill family member or to bond with a newborn or newly adopted child, with wage replacement of up to 70% of salary based on income level.

The PFL program is funded through state-required employee payroll deductions. The contribution rate is adjusted each year based on a statutory formula designed to collect revenues sufficient to fund benefits and program administration, as well as to maintain a reserve to accommodate fluctuations in fund revenue or disbursements.

Goal: 6 Months

The Governor’s budget proposal commits to expanding California’s PFL program “with the goal that all newborns and newly adopted babies could be cared for by a parent or close family member for the first six months.”

The budget plan cites research showing “a strong connection between providing this duration of care with positive health and educational outcomes for children and enhanced economic security for parents.”

Moreover, “given the high cost of infant child care, making it possible for children to be with their parents during this period is cost-effective for both families and taxpayers,” the budget plan asserts.

As a “down payment” on its commitment to broaden PFL, the administration proposes to expand the maximum duration of a PFL benefit claim from six weeks to eight weeks for all bonding and care-giving claims, effective July 1, 2020.

The proposal also will allow claimants to take a full eight weeks to help a family member for military deployment, in keeping with legislation adopted last year (SB 1123; Jackson; D-Santa Barbara; Chapter 849, Statutes of 2018), when that bill takes effect on January 1, 2021.
To deliver this expanded benefit, the Governor’s budget proposes reducing the minimum reserve in the SDI fund by 15%. According to the budget proposal, that reduction still maintains an adequate reserve that “will be sufficient to absorb fluctuations in revenues due to future economic downturns as well as increased use of benefits.”

The reserve rate change will take effect starting July 1, 2019.

Task Force

The administration also plans to convene a task force soon to consider different options to phase in and expand PFL to meet the administration’s goal that all babies be cared for by a parent or a close relative for up to six months.

According to the budget plan, the task force also “will evaluate important policy considerations such as aligning existing worker protections and non-retaliation protections for employees’ use of the program, as well as adjustments to the wage replacement rate.”
The task force is to issue recommendations by November for consideration in the 2020–21 Governor’s budget.

The Legislature has until June 15 to act on the budget. The new fiscal year begins July 1.

California Tourism Month

DID YOU KNOW MAY IS CALIFORNIA TOURISM MONTH?

Jane Howard, Director, Visit Gilroy

Unlike any other industry, tourism uniquely touches every community across the state — from California’s biggest gateways to its most tucked-away locales. California Tourism Month provides a platform for Visit California to execute a multifaceted, statewide and month long strategy to educate, inform and engage with key audiences — and Visit Gilroy is helping to tell tourism’s story.

Tourism benefits all Californians – more jobs, more spending, more tax revenue

California is the fifth-largest economy in the world – tourism is a key reason why.

  • For the ninth straight year, California’s tourism revenues have increased year-over-year.
  • In 2018, the industry generated $140.6 billion for the state’s economy – a 5.4% increase from 2017.

Taxes from the tourism industry help keep California thriving

  • The tourism industry generated $11.8 billion in tax dollars in 2018.
  • Taxpayers would each have to pay an additional $890 a year per household to cover the amount raised from tourism.

Travel is California’s top export

  • Because the California experience is a product sold to visitors of other states and nations, travel is considered an export industry.
  • Travel is California’s largest export industry, providing 1.2 million jobs. Employment increases have averaged 3.5% annually since 2010.

The travel and tourism industry adds resilience to California’s economy during challenging times

  • During the last recession, travel and tourism provided a stabilizing force allowing California to experience a slower decline and faster rebound.
  • Visit California plays an important role in supporting crisis recovery efforts and economic recovery in areas impacted by natural disaster.

All of California benefits from successfully marketing tourism

  • The money injected into our economy from tourism has benefits far beyond the traditional “destination gateways”, with positive repercussions throughout the entire state’s economy.
  • Visit California employs sophisticated destination management strategies that balance marketing efforts in ways that benefit all tourism regions.

In summary, 2018 has been another banner year for tourism in California. Visit Gilroy partners with Visit California in several advertising campaigns and now as a designated California Welcome Center. 2019 is starting out strong and we look forward to continued success in the tourism industry.

Dispatch Receives Recognition

Gilroy Dispatch Receives State-Wide Recognition

The Gilroy Dispatch was awarded First Place for General Excellence, the highest honor for California newspapers, by the California News Publishers Association in the annual California Journalism Awards May 4.

The Dispatch competed in the weekly newspaper circulation 11,001-25,000 category.

The judge in the category wrote: “Solid writing and very newsy stories. I like the way they approach some governmental coverage with real people and not a recitation of events. There is nice ad support. The sports stories and photos were engaging and a real bright spot. Very nice work on the 150th anniversary section! South Valley section is beautifully designed, shot and features are written well.”

Two Dispatch staffers also won writing awards in the statewide competition.

Dispatch reporter Michael Moore won a second-place award for In-Depth Reporting for a series of stories in the Dispatch in 2018 on the death of Steven Juarez while in police custody.

The judge wrote of Moore’s reporting, “Dispatch does a good job of staying on top of a story critical to its community.”

Gilroy Dispatch sports editor Emanuel Lee won a fourth place award for Sports Feature Writing for an article he wrote in the Free Lance in Hollister in 2018.

The sister newspapers of the Dispatch also won awards—Good Times (eight), Metro Silicon Valley (six), North Bay Bohemian (one), Pacific Sun (one)—including three first-place awards for Metro’s Jennifer Wadsworth and one for Nick Veronin. One of Wadsworth’s winning articles in Metro, on the Santa Clara County Sheriff’s Department, appeared in the Gilroy Dispatch.

Silence is Golden… State?

Article written by Ralph Vartabedian, Los Angeles Times

The California bullet train project, for much of the past decade, enjoyed no more important partner than the U.S. Department of Transportation.

DOT was supplying the state with billions of dollars in grants, showering the project with political affection and later making repeated amendments to its funding deals to help the state weather construction delays.

But today, federal agencies and the state high-speed rail authority are like a couple filing for an unseemly divorce and alleging mutual mistreatment of their child — a partly built bullet train from Merced to Bakersfield. The two sides aren’t even speaking, foreshadowing further setbacks for an already troubled rail endeavor.

In March, Transportation Secretary Elaine Chao let it spill out in a speech at the Conservative Political Action Conference.

The project is a “classic example of bait and switch,” she said in a speech, referring to Gov. Gavin Newsom’s plan to focus on building an isolated Central Valley rail segment of the original Los Angeles to San Francisco system. It gives the federal government, she said, the right to ask for the return of grants that date back to 2009 and 2010.

The federal government notified the state in February of its intent to terminate a $929-million grant that has yet to be transferred and may seek to get back a $2.5-billion rail grant that has already been spent.

In turn, California officials detailed their view of the soured relationship when they released a project update on May 1 that alleged a “disengagement” in the relationship had occurred. Up until February, the two agencies were still talking, the report said, though the federal bureaucrats would no longer “participate in meetings, review documents or act on critical decisions.”

After February, officials at the Federal Railroad Administration, a part of the Transportation Department, no longer took their telephone calls, responded to written communication or processed their environmental documents.

“This now obstructs the authority’s ability to advance the program and meet the mutual intent of the federal grant agreements,” the report added.
The rail authority has responsibility for administering California’s environmental laws on the project and it has sought jurisdiction to administer the federal laws. The FRA, however, has not granted that authority and has also not processed environmental documents under its own authority, rail authority officials say.

Both sides are accusing each other of damaging the nation’s largest infrastructure project, the first serious effort by the U.S. to build a high-speed system more than a half century after Japan made technological history by unveiling its Shinkansen bullet train.

The FRA is expected to move on its grant termination any day, though it has delayed the move since first notifying the state. The agency is taking a cautious approach, based on an expectation that the state will file suit against the move. At the same time, the Transportation Department inspector general is close to completing two audits of the grants, which could add further fuel to the fire.
Trump’s increasingly contentious relationship with California over such issues as immigration and environmental regulation — including dozens of lawsuits filed by the stateagainst the Trump administration — is undoubtedly one aspect of the standoff.

“It is a partisan political attack,” said Rep. Grace Napolitano (D-Norwalk), a member of the House rail subcommittee. “There is a lot of animosity.”

Napolitano, who has supported the rail project though she doesn’t like the routes and doubts it will benefit her working-class constituents, said Democrats will sue over any grant termination.
No doubt, the rationale for high-speed rail, with its claims to reduce greenhouse gases, create European-style city centers and reduce jetliner traffic between Los Angeles and San Francisco, ran headfirst into conservative ideology. But the political standoff probably does not explain the entire situation, according to knowledgeable individuals close to the project.

Behind the scenes, Obama Administration officials were sounding alarms at least as far back as December 2016, when they presented a risk analysis to their California counterparts at a meeting in December 2016, projecting a 50% cost increase for the Central Valley construction and a long delay. When The Times obtained a copy of the report and published it in January 2017, the rail authority said the analysis was wrong.

In the final days of the Obama administration, federal bureaucrats had begun tightening control of the grants, requiring that the state match all of the $2.5-billion initial grant before it could begin tapping the second pool of $929 million. It essentially pushed back the state’s ability to use that money by a half decade, even before the action to terminate the grant.

It was the Obama administration that wrote the crucial language buried deep in the grant agreements that now loom as a hammer over the state: “Any failure to make reasonable progress on the project or other violation of this agreement that significantly endangers substantial performance of the project shall provide sufficient grounds for FRA to terminate this agreement.”

The fuzzy language in the 2010 grant of “reasonable progress” was signed before the rail authority had an in-house counsel. It relied on the state attorney general for legal advice — another example of how the rail authority’s skeleton staff left it vulnerable.

For nearly two years after he was elected, Trump did not actively target the California bullet train. Indeed, in 2017 he complained about the lack of high-speed rail in the U.S. compared to foreign countries. “I don’t want to compete with your business, but we don’t have one fast train,” Trump told airline executives at a White House meeting.

But the “switch flipped” last fall, according to one official close to the matter.
The FRA began to reject invoices submitted for reimbursement under the original $2.5-billion grant. The rejections included those for the state’s main consultant, WSP, forcing the authority to a $30-million negative entry for WSP in financial statements last year, rail authority records show.

In a letter sent in mid-February, the FRA disclosed its intent to terminate the grant because the state was failing to make the sustained progress necessary to meet a 2022 deadline to complete 119 miles of rail construction in the Central Valley that was required under the grant agreement, along with other provisions.
“This all sounds very unusual to me,” said Eloise Pasachoff, a law professor specializing in federal grants at the Georgetown University Law Center. “If an agency thinks that a grantee is not making satisfactory progress, there are many steps, including much more direct oversight and monitoring, that the agency typically takes before deciding to terminate the grant.”
“And ceasing communication is most unusual,” she added. “Especially with sums at stake of this size, it’s hard to understand the agency’s actions as a sensible choice to protect taxpayer funds.”

Pasachoff said federally funded programs in states often have serious implementation problems and the sponsoring agency does not tend to start termination even when it might be plausible.
“The fact that the president has tweeted several times about cutting off federal funds to California because of various policy disagreements suggests that something else might be going on,” she said.

Brian Kelly, chief executive of the rail authority, is taking a cool approach, saying, “We have respectfully sought the restoration of a functional partnership and we are hoping the federal agency will respond favorably.”

But Chao took a much different viewpoint in her speech, saying the Transportation Department would not only go after the $929-million grant but also find a way to claw back the $2.5-billion grant. “On behalf of the American people,” she said, “we have the right to ask for that $2.5 billion back, as well.”

Trump Helps California

Trump Helps California to The Tune of Approximately $3 Billion
Article written by Elizabeth Campbell and Elise Young, Bloomberg

States are enjoying windfalls after struggling to predict how President Donald Trump’s federal tax law changes would ripple through their revenue.

All 15 of the states that have reported April tax collections so far have seen them come in better than expected, according to a list compiled by National Association of State Budget Officers. California, Illinois, Connecticut are them, and New Jersey is expected to report its tally next week. Governor Phil Murphy said last week that tax collections will be more than $250 million above projections.
“It gives decision-makers cushion,’’ said John Hicks, executive director of the Washington-based National Association of State Budget Officers. “Where states are debating or on the margins, this little extra revenue certainly makes this a little easier.’’
The influx is providing extra cash for governments already benefiting from the nearly decade-long economic expansion and is coming just as many set their budgets for the coming fiscal year. In some cases, it’s making up for shortfalls earlier in the budget year as tax revenue lagged official forecasts because of the difficulty in predicting how the U.S. tax changes, including the $10,000 cap on state and local deductions, would ripple down through the state capitals.

In California, for example, officials said that taxpayers procrastinated in filing their returns this year over concern that the new deduction limit would drive up what they owe. Then in April, the state collected about $3 billion more in personal-income taxes than Governor Gavin Newsom’s forecast, making up for a shortfall earlier this year and adding to the government’s swelling surplus fueled by stock market gains.

Moody’s Investors Service said California’s experience bodes well for other high-tax states, and Mikhail Foux, head of municipal strategy at Barclays Plc, said most are likely to see revenue surpass expectations in April. Connecticut’s personal-income taxes last month brought in $100 million more than forecast. While New York hasn’t reported April’s figures, its March tax receipts were higher than forecast.

Some are already laying out plans on how to use their extra cash. After Illinois’s April tax collections topped forecasts by $1.5 billion, Governor J.B. Pritzker backed off his proposal to put off some of next year’s pension payment, which critics had derided as a partial pension holiday. That was welcomed by investors, who bid up the price of the state’s bonds, pushing down the yield penalty it pays to the smallest since July because it will help with the government’s massive pension-fund debt.

New Jersey Governor Murphy said on May 6 that he’d put the $250 million of unexpected tax revenue toward homeowner relief from the nation’s highest property taxes if lawmakers approve his proposed millionaire’s tax for the fiscal year starting July 1. But the tax hike on the highest earners faces a challenge in the legislature, where the Senate leader opposes it.
Even so, the extra revenue is a welcome development for Murphy, who promised a more conservative approach to forecasting than the prior administration that was handed a slew of bond-rating downgrades.
Murphy’s job was complicated by the difficulty of determining how the federal changes would affect Garden State residents. From July to January, New Jersey income-tax revenue was down 6%, while growth had been forecast at 5.4%. In February, S&P Global Ratings warned that even an April bump — on which the state is still counting — might not be enough to fill the hole.
It still remains to be seen how much of the higher-than-expected revenue across states will be recurring or if it’s a one-time bounty, according to the National Association of State Budget Officers.
“We’re seeing good signals and good signs in the economy at large, that always would tend to be correlated with revenue growth,” said Matt Butler, a vice president and senior analyst at Moody’s. “Clearly growing revenue, all else equal, tends to be credit positive for the states.’’

— With assistance by Romy Varghese

Marijuana in the Workplace

In the newest episode of CalChamber’s podcast, The Workplace, CalChamber General Counsel and Executive Vice President Erika Frank is joined by employment law attorney Jennifer Shaw to discuss how legalization of marijuana is impacting both workers and business owners in California.

For Leaders Only

The Leadership of Forgiveness
Mark Turner, President of the Gilroy Chamber of Commerce

On February 9, 1960, Adolph Coors III, millionaire head of Coors Company, was kidnapped and held for ransom. Seven months later his body was found on a remote hillside. He had been shot to death. Adolph Coors IV was then fifteen years old. He lost not only his father, but also his best friend. For years Adolph Coors IV hated Joseph Corbett, the man who was sentenced to life for the slaying of Adolph Coors III.

In 1975, almost 15 years later, Adolph Coors IV became a man of faith. Yet, his hatred for Corbett, the murderer of his Dad, still consumed him.

Adolph Coors knew he needed to forgive Corbett as he himself had been forgiven. So he visited the maximum-security unit of Colorado’s Canon City penitentiary to talk with Joseph Corbett, however, Corbett refused to see him.

Adolf Coors left Joseph Corbett a Bible with the following inscription: “I’m here to see you today, and I’m sorry that we could not meet. As a man of faith, I am summoned to forgive. I do forgive you, and I ask you to forgive me for the hatred I’ve held in my heart for you.”

Later Coors confessed, “I have a love for that man that only God could have put in my heart.”

Business leaders do much to hone their skills as leaders. They learn about communication, team building, vision casting, influence, risk management and assessment, strategic planning, conflict resolution and much more. One area of leadership not often discussed is the area of forgiveness. Leaders must be able to forgive their employees, team members, directors and others if they desire to be the most effective leaders possible. They must also be willing to admit mistakes and offenses and seek forgiveness from others.

Be Willing to Forgive

If leadership is influence, forgiveness is freedom. Nothing can hinder leadership and influence more than the unwillingness to forgive someone on your team or under your direction. There are going to be times when someone doesn’t do what you expect, says something disrespectful, acts in an unbecoming way, betrays your trust or drops the ball with regard to meeting a deadline. While some situations require disciplinary actions and even worse, possible dismissal, forgiveness still needs to be part of the equation.

The first step to forgiving is being willing to forgive. Taking up an offense and holding a grudge is not healthy for the individual who is offended but it’s not healthy for the team either. Team members can sense when there is tension between individuals, especially between a leader and a subordinate. It’s always best to gather the facts, deal with the individual directly without undue delay, come to a resolve and forgive the offense. Sometimes an offense can take more time to “heal” from, but don’t let anger, resentment and bitterness linger. It will poison you and your team.

By the Measure of Forgiveness You Provide, So Too Will Others Forgive You

Leaders are not exempt from offending others and need to be aware when it happens. For various and understandable reasons, workers don’t usually approach their leaders when the leader has acted in an offensive way, said something hurtful or was carless about the effort put forth by their team.

When a leader becomes aware of their own offensive actions or words, they need to move quickly to admit their wrong and seek forgiveness from others. Leaders will quickly find that by the measure of forgiveness they have provided others, they will be rewarded by that same measure in return. For some, that may not be good news.

Leading in the area of forgiveness is not easy, but it is necessary to lead effectively.

It’s Not About Getting Even – It’s About Getting Even-Keeled

When someone says or does something to hurt or offend us, we are thrown off kilter. We may be taken back by those actions. We struggle to understand what warranted such comments or actions. Thoughts might turn to paying that individual or organization back, however, it’s not about getting even, it’s about getting even-keeled.

The word keel has its origin in boating and sailing. The keel is a flat blade sticking down into the water from a sailboat’s bottom. It has two functions: it prevents the boat from being blown sideways by the wind, and it holds the ballast that keeps the boat right-side up.

When applied to people, even-keeled means someone is well balanced and not likely to change suddenly.

Leaders don’t allow the actions and comments of others to blow them off course or lose sight of the goal and destination. As tempting as it may be at times to strike back or engage in a verbal boxing match, good leaders know how navigate through delicate situations not stoking the flames by foolishly saying and doing things to create more problems.

Forgiveness is a keel that keeps leaders on course, properly focused, and free from torturous thoughts.

Louis B. Smedes said, “To forgive is to set a prisoner free and discover that the prisoner was you.”

Labor Shortage

California Farmers Facing Labor Shortage
Article from Capitol Public Radio

California farmers are facing a serious shortage of labor according to a new report by the California Farm Bureau.
A survey showed that almost six out of 10 farmers were unable to hire all the workers they needed at some point in the past 5 years. Many of those farmers said shortages were worse the past two years, even though 86 percent of farmers said they had raised wages.

“With competition the way it is especially during peak summer season, minimum wage rarely applies especially when it comes to the harvest season,” said Ryan Van Gronigen, who grows melons, corn, and pumpkins in the Manteca area. “Those jobs are definitely well over minimum wage.”

Van Gronigen says mechanization helps some, but can’t replace the labor force entirely. He expects the peak season from June through August will see the biggest demand for labor.

“There’s Washington, there’s Utah, there’s Colorado, there’s all these different locations going that are in peak season in terms of harvesting fresh fruits and vegetables, he says. “So there’s a lot of competition when it comes to trying to secure enough labor to harvest all these crops.”

The farm bureau report shows some farmers are delaying pruning, switching acreage, and reducing the harvest.

Big Month for Jobs

April Was a Big Month for Jobs
Article written by Katia Dmitrieva, Bloomberg

U.S. companies added the most workers since July last month amid gains in services and medium-sized businesses, according to private data, pointing to a robust jobs market ahead of the government’s monthly jobs report Friday.

Private payrolls increased by 275,000 after an upwardly revised 151,000 gain in March, according to ADP Research Institute data released Wednesday that exceeded all economist estimates in Bloomberg’s survey. Hiring by service providers surged by 223,000, the most in nearly three years.

 

Key Insights

  • The rebound from the prior month, revised up from an initial reading that was the weakest in 18 months, shows the labor market remains on even footing as companies strive to hire and retain workers. Official data Friday are forecast to show April payroll growth just above the 180,000 average over the past three months.
  • “The job market is holding firm, as businesses work hard to fill open positions,” Mark Zandi, chief economist at Moody’s Analytics Inc., said in a statement. Moody’s produces the figures with ADP. “The economic soft patch at the start of the year has not materially impacted hiring. April’s job gains overstate the economy’s strength, but they make the case that expansion continues.”

Billions Held Up in Congress

Billions in California Wildfire Relief Held Up in Congress
Written by Tal Kopan, San Francisco Chronicle

WASHINGTON — Members of Congress are back in Washington after a two-week holiday recess, but there’s no sign of a breakthrough on disaster relief funding that California and other states have been waiting on for months.

The sticking point appears to be the same: The White House will not allow more money for Puerto Rico hurricane recovery, while Democrats say they won’t pass relief for other disasters without it.

“There’s been no movement on that lately. There’s always hope,” said Sen. Richard Shelby, R-Ala., chairman of the Senate Appropriations Committee. “We’ve been gone a couple of weeks and our staff’s been talking, but there’s no movement.”

Democrats voted for a House-passed bill from January that would have funded continued Puerto Rico recovery from Hurricane Maria as well as other disasters. That bill lacked funding for flooding in the Midwest that occurred as negotiations dragged on, after Republicans blocked Democrats from adding it.

House Democrats have now introduced an updated disaster package that includes relief for the flooding, and that bill is expected to come up for a vote next week.

Senate Republicans, however, thought Democrats were “moving the goalpost” by embracing a provision that would require the federal government to shoulder all of the cost of recovery on the island without requiring local contribution, potentially adding billions to cost, according to a Senate Republican aide. That provision was in the bill that the House passed in January, but was not in a compromise proposal put forward in the Senate by Minority Leader Chuck Schumer of New York and Sen. Patrick Leahy of Vermont, ranking Democrat on the Appropriations Committee. Republicans also rejected that offer.

Schumer threw his support behind the new House package Monday on the Senate floor.

“As we get back to legislative business this week, I urge my colleagues: Let’s put politics aside. Let’s do the right thing,” Schumer said. “Let’s tell President Trump that his obsessive nastiness to Puerto Rico, unfounded by fact, is not going to prevent millions of people in the Middle West and the West and the South from getting the relief they need.”

California has requested $9 billion from the federal government to help it recover from wildfires in 2018 and 2017, and other states and territories in the Southeast and Pacific are also reeling from a destructive year of disasters. But Congress has failed to pass money to help fund any of the needs, held up by the dispute over Puerto Rico. Californian individuals and entities are eligible for billions in the proposed bill.

The White House has driven the objection. In tweets about the standoff, President Trump said officials in Puerto Rico, a U.S. territory, are “grossly incompetent, spend the money foolishly or corruptly, & only take from USA.”

Trump brought a chart to a meeting with Senate Republicans in late March to make the case that the island had already gotten too much money compared with U.S. states — although the figure he cited was billions of dollars more than Puerto Rico has actually received, according to the Washington Post.

Still, lawmakers remain hopeful of a thaw. Florida GOP Sen. Rick Scott said a White House meeting just before recess had left him “very optimistic.”

“We’re going to get there if it kills me,” said Sen. Johnny Isakson, R-Ga., whose state’s farmers have been waiting since October for relief in the aftermath of Hurricane Michael. “It’s my responsibility, and I’ll do everything I can to make it happen.”

Rail Project May Increase by $1.8 Billion

California’s Decreased High-Speed Rail Project May Increase by $1.8 Billion
Article written by Ralph Vartabedian, Los Angeles Times

The cost of building a 119-mile section of the California bullet train in the Central Valley is projected to increase by $1.8 billion, taking the total to $12.4 billion, according an internal draft report by the state rail authority’s staff.

The estimate was made in preparation for a project update that the rail authority is scheduled to release to the Legislature on Wednesday, detailing a plan by Gov. Gavin Newsom to build a partial high-speed system running from Bakersfield to Merced.

The draft report projects that the cost of building that partial operating system, including the 119-mile section now under construction, would be $20.4 billion.

The report projects that the rail authority would complete it between 2026 and 2030. The contents of the draft report were described by an official close to the project, who asked not to be identified because he was not authorized to discuss it.

The rail authority staff had prepared the report for its board meeting on April 18, though the estimates were not discussed. Since they are contained in a draft document, they could be revised when the project update is released on Wednesday.

Gov. Gavin Newsom called for building the Bakersfield to Merced system earlier this year, saying the full $77-billion project to connect Los Angeles to San Francisco with 220-mph trains had no funding or realistic plan for completion.

But the slimmed down Central Valley project raises critical questions, such as its construction cost, schedule, ridership and operating costs versus revenues. The staff report and a parallel one by Deutsche Bahn Engineering and Consulting, which is advising the state under its role as the “early train operator,” outlined some of the challenges to Newsom’s plan.

Newsom told the Times earlier this month that he wants to curtail the role of consultants,criticizing their performance, though the report does not address any of those plans.
The construction of a Bakersfield to Merced operating segment depends, the report says, on no further cost increases, an appropriation by the Legislature of all remaining funds from a 2008 bond and the retention of federal grants that the Trump Administration wants to terminate.
The $1.8-billion cost increase covers bridges, viaducts, trenches and roadbed from Madera to Wasco, a distance of 119 miles. That includes $477 million for actual cost increases, $362 million for increases in scope of the project and nearly $1 billion for additional contingencies to manage risk.

Central Valley costs have been growing for years. Originally, the rail authority had planned to build about 130 miles of track from Madera to Bakersfield for about $6 billion. Now the construction ends north of Bakersfield near Wasco. The cost of land acquisition, utility relocations and environmental assessments, among other items, have grown sharply.
The $20.4-billion cost to build the Bakersfield to Merced line would take almost all of the rail authority’s funding through 2030. It includes all the bonds that taxpayers approved in 2008, all the federal grants provided by the Obama Administration and all of the 25% share of greenhouse-gas fees that the state collects in quarterly auctions. It is unclear how the rail authority would complete the partial operating segment by 2026 on funding that does not arrive fully until 2030.

Once it begins operating, the bullet train would carry 1.7 million riders, the report projects. It is not clear whether that prediction would be included in the project update on Wednesday. It would connect with the existing San Joaquin diesel-powered rail service operated by Amtrak and the Altamont Corridor Express, or ACE, that would run from Merced to San Jose. That would create a link, though a slow one, from Silicon Valley to the Central Valley.

The analysis projects ridership would double on those rail lines as a result of the bullet train.The combined services of all three lines would lose $63 million, though that would be less of a loss than ACE and San Joaquin would sustain without the high-speed rail.

Whether the Newsom plan will fly or not will depend partly on how much support it gets from Bay Area and Southern California political leaders.

The Metropolitan Transportation Authority had considered this month adopting a resolution to ask the rail authority for a fresh assessment of spending more money in the Central Valley and to “prioritize” investments in Southern California. The resolution was pulled off the April agenda at the last minute.

Ara Najarian, a MTA board member and a Glendale councilman, said he grew immediately worried after Newsom announced cutbacks in the program at his state of the state speech.
Najarian and others want funding to improve the existing commuter rail service operated by Metrolink to Palmdale, allowing it to eventually serve as the connection to the bullet train system.

“We are concerned that the money for this will be grabbed by Northern California,” he said. “We expect money to improve our system.”

Some Bay Area leaders are also growing more concerned, because the Newsom plan failed to find funding to build a high-speed rail line from San Jose through Gilroy to the Central Valley.
But the rail authority has not backed off on any of its commitments to Southern California, said rail authority spokeswoman Annie Parker. She cited a lengthy list of state-funded projects, including new tracks at Union Station, that will speed movements in and out of passenger platforms.

Separately, Michelle Boehm, Southern California regional director of the high-speed rail project, is leaving the program, it was learned. Parker confirmed she has accepted another position.

April 2019

Elected Officials Gather in Gilroy

The Chamber of Commerce hosted its 6th Annual Legislative Summit this past Friday with elected officials addressing a number of issues ranging from transportation, homelessness, housing, taxes and water resources to name a few. Elected officials attending were Congresswoman Zoe Lofgren, Congressman, State Senator Bill Monning, State Assembly Member Robert Rivas, County Supervisor Mike Wasserman, Director John Varela from the Santa Clara Valley Water District, Gilroy Mayor Roland Velasco and Morgan Hill Mayor Rich Constantine.

Ninety-five people packed into the Summit at the Hilton Garden Inn. The $45 fee included lunch and an opportunity to speak one-on-one with elected officials from all levels of government. The event was also generously sponsored by Kaiser Permanente, Integrated Financial Benefits, Recology, Ruggeri-Jensen-Azar, Bracco’s Towing, Cline Glass, Olam, GilPAC, Pinnacle Bank, Heritage Bank, Santa Clara County Association of Realtors and Rabobank.

The Legislative Summit allows business leaders and residents in South County to learn more about what our elected official are working on and how their efforts affect the region. It also maintains the momentum, growth and evolution of the Chamber’s government relations and public affairs efforts.

The Gilroy Chamber of Commerce continually works to represent the interests of business with government and the Legislative Summit is one of those ways. The Chamber’s Government Relations Committee meets monthly to discuss local, regional and state issues. Members of the Chamber of Commerce are encouraged to attend the meetings which are held on the second Friday of each month from 7:30 to 9:00 am.

What’s New with Business

Eric Howard, Business Relationship Manager, Gilroy Chamber of Commerce

Performance Food-Service Ledyard is hiring in Gilroy. Come to the hiring event this Thursday, May 2, from 11:00 am to 4:00 pm, at the Hilton Garden Inn, 6070 Monterey Road, Gilroy. They are searching for Night Order Selectors, Class A and B drivers, Safety Managers, Accounting and more. Earn a great salary, while working with great people.  Email gilroyjobs@pfgc.com for more info.  Performance Food Group is an equal opportunity employer.

At Farmers Insurance -Stefanie Pinheiro Agency, they treat you like family! They are a 2nd generation Farmers Agency. Stefanie Pinheiro, a Gilroy native, has been in the insurance industry and with Farmers insurance for over 18 years. She recently took over for her Father-in-law Al Pinheiro, who after more than 40 years as a Farmers agent decided to retire. Al Pinheiro was the founding President of Gilroy Exchange Club and founding president of Sister Cities Association in Gilroy. Al Pinheiro was also on City council for twelve years. Nine of which he served as Mayor. Stefanie is married to David Pinheiro, Farmers District Manager and Al’s son. They have 3 wonderful children. One of which is employed at the Pinheiro Agency. Nadgie Haro, is also an important part of the Pinheiro team. She has been with Farmers for nearly 17 years. With over 140 years of combined experience in the insurance industry the Pinheiro team is committed to protecting you and your families through all of life’s different stages. Stop by their ribbon cutting Wednesday, May 8, from 5pm-8pm, 190 First Street, Gilroy.

The Success Guys, created by Gianfranco Filice and Camden McRae, helps high school students navigate the college admissions process. College admissions are more competitive than ever, but with combined acceptances to every top school, they are confident that they will help you get into your dream school. Through a holistic and individualized approach, they will ensure that you’re a standout applicant. Most importantly, they will help you realize that you can find success and happiness in any environment. Gianfranco is a junior, studying Economics at Stanford. He’s worked as an entrepreneur and in venture capital, as well as with Visa, McKinsey, & Goldman Sachs. Camden studied psychology at Harvard, and is a 3rd-year law student at Stanford. His experiences include sports & entertainment, law, entrepreneurship, and currently, venture capital.

A secure financial future doesn’t just happen by accident. It requires thoughtfully identifying your goals and developing a plan to achieve them. Now is the time to make or adjust your plan toward a secure financial future. Call Jeffrey M. Orth, ChFC, CASL, owner of Integrated Financial Benefits Network at 408-842-2716 for your complimentary appointment to get a head start on securing your financial future.

Golden State Brew and Grill (GSB) first started in February 2016 with their brewery and tap room in Santa Clara, California. Within a year of being open they had expanded to over 100 retailers. They then opened a taproom in San Diego briefly introducing beer cocktails, which they plan to bring to the Gilroy location once the liquor license goes through escrow. Golden State Brew & Grill is their newest project including a full kitchen, 2 bars, 10 arcade games, dog friendly outside seating patio, stage, live music and entertainment, and will have over 30 TVS. Golden State Brew & Grill is the new family friendly spot in town.

Studio Three Dance, 7488 Monterey Street, has been teaching dance for many years in Downtown Gilroy. Traci Dalke, the owner, enjoys having her studio Downtown because of all the activity. She is currently offering the first class free of charge. So, if you have ever wanted to improve your dancing or your child has shown interest in dancing, Traci can reached at 408-846-5392 or www.studiothreedance.com. Their hours are Monday – Thursday, 3:30pm – 9:00pm. They teach competitive and non-competitive programs for adults and children as young as 2 ½ years of age. The dance styles offered are tap, jazz, ballet pre-pointe and pointe, lyrical, contemporary and hip hop.

A Hairstylist’s Perspective

A Hairstylist’s Perspective. Why Can’t I Just Be a Contractor?
Written by Ivonne Herrera

You know that feeling when you’ve been pampered for a big night? You get your hair done, spend hours picking your outfit, and now the confidence to go with it. Well, my job is to provide that magic to you.

I have been a hair stylist for 10 years, nine of which I spent booking appointments with clients and renting salon space. Since California’s sharing economy took off, I have also worked as a Glamsquad professional for the last four-and-a-half years, bringing beauty and ease to your living room. These options allow me to work when I want, freeing myself to take my kids to school and volunteer with young cancer patients.

In other words, I bring you magic.

This opportunity has been the highlight of my career. Like anything worth having, leaving the corporate world over a decade ago in order to pursue my passion meant sacrifice. My husband and I committed ourselves to earning our income through independent contracting and that choice has more than paid off.

Our early sacrifices led to immediate flexibility and control of my own schedule. Rather than catching up with my family later in the evenings and on weekends, I booked my clients based on my own calendar. I was able to take and pick up my daughters from school, spend time with my family, and schedule time to give back to my community. One my proudest contributions is the time I spend with young cancer patients, creating the opportunity for them to feel beautiful during a fight that is often so dim.

My ability to make this contribution, support my family, and maintain a flexible work-life balance is rooted in my status as an independent contractor. There has been much discussion lately in the news and amongst lawmakers about independent contracting, and it is important to make clear distinctions between my classification and that of an employee.

As an independent contractor, I communicate directly with clients in order to book appointments, manage my portfolio and build my business. This is the key factor for my flexibility as a mother and a professional. Traditional employees, which I once was when I first began hair styling, do not have this autonomy. Employees must work during specific times determined by their employer. While employers are able to predetermine different working hours, nothing requires them to ensure flexibility the way controlling my own schedule does.

Furthermore, handling my own schedule, rather than being told when to show up and go home, provides me the freedom to take breaks throughout the day to tend to other responsibilities. For instance, I can book clients from 1pm and 4pm, allowing myself time to pick up my kids from school and return to work. However, as an employee, I would be allotted specific break times at specific hours. The rigidity of these regulations prevents me from skipping a meal break in order to leave early to pick my kids up from school. As a mother and a professional, the choice is clear: remain an independent contractor.

Easier said than done.

My plan to remain an independent contractor is at risk due to a 2018 California Supreme Court ruling, the so-called Dynamex decision, which redefines the classification of an independent contractor. Meaning: I may be forced to become an employee of a salon or beauty company, and forced to maintain specific, rigid hours that prevent me from caring for my family, providing a gift to young cancer patients and being available to clients when it’s convenient for them.
My ask to lawmakers is simple: protect my freedom, flexibility, and my status as an independent contractor.

Ivonne Herrera of Sherman Oaks is a hair stylist who operates Hair-Era by Herrera and works at a shop in Burbank.

The Most Important Tax Day

Why April 15 Isn’t California’s Most Important Tax Day
Written by Robert Gutierrez, California Tax Payer’s Association

April 15 is infamously known as “tax day” in the United States, but given the broad array of taxes we face, the reality is that every day is tax day, especially in California.

That alarm on the cellphone that wakes you up? You paid sales tax when you bought it at the highest state-level sales tax rate in the nation, plus local add-ons. You also pay a utility tax on the electricity that keeps your cell charged.

You get up, watch the television news (tax on cable service) and take a hot shower (utility taxes on water and sewer service).

You jump in the car (gas tax, vehicle tax, tire tax) and head to work, stopping to grab breakfast at a local cafe (sales tax on prepared food consumed on the premises).

You pay higher retail prices to cover the taxes imposed on the cafe and other businesses (property tax, business license taxes, corporation tax, etc.).

At work you receive your paycheck (nation’s highest state income tax for higher earners, federal income tax, Social Security tax, Medicare tax and State Disability Insurance tax).

You make plans for an out-of-town conference (hotel tax, federal transportation tax, 9/11 security “fee,” federal flight segment tax, federal passenger facility charge).

After work you meet a friend for tacos (sales tax) and a beer (alcohol tax), then head home (value-based property tax, parcel taxes, Mello-Roos tax, plus property taxes to repay local bonds). After reading a book (more sales tax), you hop in bed (mattress and box spring “recycling fees”) and repeat the cycle.

Thanks to all of these taxes, California’s government has a record budget reserve of $20 billion, according to the California Department of Finance.

Still, legislators proposed more than $6.2 billion in tax and fee increases as of the February bill-introduction deadline, and billions more were proposed by subsequent amendments.

These include a proposed repeal of tax exemptions for prescription drugs and other products, Senate Bill 468. There are tax-like “fees” on water users in Assembly Bill 217. There are proposed taxes on sugar-sweetened drinks, AB 138, and on services such as auto repair and dog grooming, SB 522.

There’s an estate tax, SB 378, and a measure that would drive jobs out of the state by making California’s business taxes the highest in the nation, SB 37.

On top of all of the proposals from lawmakers, a proposal to increase business property taxes has qualified for the November 2020 ballot. It would do away with Proposition 13 protections for business owners, resulting in more lost jobs and higher consumer prices.

Death and taxes are all but certain. But the bright side is that the power to tax ultimately lies with the people, as Californians have the constitutional right to vote on local taxes, and the right to elect state officials with taxing power.

This makes Election Day the most important tax day of all.

Robert Gutierrez is president and chief executive officer of the California Taxpayers Association, Rob@caltax.org. He wrote this commentary for CALmatters.

Cannabis Use Must Not Be Ignored

Mental Illness Implications of Cannabis Use Must Not Be Ignored
Written by Alex Berenson

For California voters, recreational marijuana legalization was sold as a win-win-win: billions of dollars in new tax revenues, a chance for law enforcement to focus on more serious crimes, and the societal acceptance of a relatively low-risk alternative to alcohol.

But as the state stumbles through its second year of fully legalized cannabis, the reality appears to be more lose-lose-lose.

Tax revenues have fallen far short of expectations, as the state’s heavily regulated and high-cost legal industry struggles to compete with dealers and illegal dispensaries. California earned about $345 million in cannabis taxes in 2018, half of earlier projections.

In fact, excise taxes on sales actually fell in the fourth quarter, as overall legal sales dropped. Now the industry is asking regulators for help cracking down on the black market, a development that may mean law enforcement will become more aggressive about pursuing marijuana-related crimes.

At the same time, evidence of dangers that cannabis and THC pose – especially to mental health – has mounted.

I examined those risks in detail in my new book, “Tell Your Children: The Truth About Marijuana, Mental Illness, and Violence,” which details a generation of scientific studies linking cannabis to psychosis and schizophrenia, a devastating brain disease which causes sufferers to have hallucinations, delusions, and paranoia.

(THC is the chemical in cannabis primarily responsible for its psychoactive effects and psychiatric risks. Cannabis sold for recreational use today contains up to 30 percent THC, compared 1 to 2 percent when the drug first became popular in the 1970s. Users today also commonly consume edible products laced with near-pure THC oil; smoking near-pure THC extracts called “wax” or “shatter” is also common.)

Peer-reviewed medical journals all over the world have published disturbing new studies about the drug’s dangers.

A paper in February connected teenage cannabis use to depression and suicidal thinking in adulthood. Another in mid-March showed that teenagers who use marijuana daily were five times as likely to develop psychosis. Still more recently, emergency room physicians in Colorado reported that marijuana-related visits have soared since voters approved recreational legalization there in 2012.

Further, suicide data from Colorado shows that suicides in which people had THC in their blood increased roughly four-fold between 2006 and 2016. Fatal driving accidents in which people had THC in their blood have risen sharply.

Alongside the mental health, suicide, and driving risks of cannabis, real-world evidence that the drug may drive violence has also mounted. While cannabis makes some users euphoric and relaxed or even lethargic, it makes others paranoid. The risk is so well-known that dispensaries advertise some cannabis strains as less likely to produce paranoia than others.
But people with psychosis are at a high risk to commit violent crimes, especially homicide. For them, the paranoia that marijuana provokes can be more than unpleasant; it can lead to sudden and devastating violence.

Aggravated assaults and murders have soared in the first four states to legalize since recreational dispensaries began to opened in 2014. No one can say for certain at this point that legalized marijuana has driven the crime increase, but police and media reports show a clear nexus between cannabis use – or dealing – and crime in many cases.

In California, the drug has been legal for recreational use for just over a year, not long enough for even the most basic crime trends to become apparent.

Even so, the drug has been linked to high-profile homicides recently, including the cases of Camden Nicholson and Kevin Douglas Limbaugh. Nicholson, 27, allegedly killed his parents and their housekeeper at their Newport Beach home in Feburary; a civil lawsuit filed on behalf of the housekeeper claims that Nicholson abused marijuana and steroids before committing the crimes. Limbaugh, 48, murdered Davis Police Officer Natalie Corona in January before killing himself; a toxicology report showed he had THC and alcohol in his blood.
With evidence of marijuana’s risks mounting, California badly needs to compile more data on the health risks of the drug.

But it is not. In fact, the state’s Cannabis Advisory Commission said in its 2018 annual report that cannabis regulators had “not implemented” their recommendation to “collect data and report yearly on youth and adult cannabis use and overuse; ER visits and treatment episodes; DUI and poison control calls related to cannabis.”

So why haven’t you heard about any of these problems?

Backers of legalization – and their supporters in the media – have successfully cast marijuana legalization as a racial and social justice issue, although almost no one is in prison for cannabis possession. And they have vastly oversold the potential medical benefits of the drug, while understating its risks.

I have seen the aggressiveness with which they attack anyone who dares criticize cannabis for myself. I am a former New York Times reporter who spent years investigating the pharmaceutical industry, but some have called me a shill for Big Pharma, which they seem to believe wants to keep cannabis illegal.

The attacks on me don’t bother me. But the media’s reluctance to discuss the risks of cannabis does–especially now, with use in the United States soaring, led by the states that have legalized.

Data from the early legalization states show that legalization causes adult cannabis use to rise, in part because prices fall. Even in California, where legal prices remain high, use will likely go up in the next few years, as legal dispensaries and delivery services openly advertise.
Legalization makes people believe that cannabis is safe, and encourages some people who otherwise would have stayed away from an illegal drug to try it.

The promised benefits of legalization have so far been mostly illusory for California. But the harms are real–and if the scientific studies and data from Colorado and other early legalization states is any guide, they are only going to grow.

Alex Berenson is a novelist, journalist, and author of “Tell Your Children: The Truth About Marijuana, Mental Illness, and Violence,” alexberensonauthor@gmail.com. He wrote this commentary for CALmatters.

Trailer Bills

How Budget “Trailer Bills” are Misused
Opinion written by Dan Walters, CALmatters

In the jargon of the Capitol, “trailer bills” are measures that accompany the annual state budget – in theory making the changes of law necessary to implement the budget’s fiscal policies.
In practice, they serve another, much different function – to sneakily do things that might otherwise be difficult to do if they were fully exposed in advance to the public.

Because trailer bills are considered part of the budget, they can be enacted with simple majority legislative votes and take effect immediately upon being signed by the governor, thus protecting them from being challenged via the referendum process that would give voters the final word.
The blatant misuse of trailer bills, making them into political Christmas trees festooned with ornamental favors to interest groups, finally sparked a ballot measure that requires them to be in print for 72 hours before final passage votes. But that has only slowed their misuse, not prevented it.

A case in point is Senate Bill 861, which whipped through the Legislature in a few days last August. It was an attempt to legalize a $331 million diversion of funds away from distressed homeowners after the diversion was declared illegal by the courts.

In 2012, the federal government and 49 states, including California, settled a massive suit against the nation’s five largest home mortgage servicers, alleging mishandling of home loans that contributed to the nationwide financial crisis a few years earlier.

California received $410 million, most of which was supposed to be used to relieve the financial impacts on homeowners.

However, Jerry Brown had just become governor when the cash arrived in Sacramento and he was coping with a massive budget deficit that resulted from the financial crisis. So one of the steps he and the Legislature took to balance the general fund budget was to divert $331 million from the settlement into repaying existing housing bonds and offsetting some expenditures in the Department of Justice.

The diversion sparked a lawsuit from consumer advocacy groups, alleging that the money was not being used as intended and ever since it’s been winding slowly through the courts with the state consistently losing.

SB 861, drafted and passed while the dispute was before the state Supreme Court, was an effort by Brown and legislators to stop their losing streak. It would, essentially, declare that the diversion was legal. However, it just generated another judicial slap-down.

Early this month, three justices of the Sacramento-based 3rd District Court of Appeal ruled that the legislation still doesn’t make the diversion legal and ordered the state to use the $331 million for its intended purposes.

Jerry Brown’s name is no longer on the lawsuit because he’s been succeeded by Gavin Newsom, who’s now the defendant and was ordered by the appellate court “to retransfer from the General Fund to the National Mortgage Settlement Deposit Fund the sum of $331,044,084.”
Newsom could appeal to the state Supreme Court, but likely would lose. An appeal, asking legal permission for the state to stiff consumers, would also be bad political optics.

The lessons Newsom should take from this case are to use the money as intended, to help distressed homeowners, not underwrite the state budget, and stop misusing budget trailer bills. But don’t count on that outcome. New trailers are already being drafted for the new budget cycle.

Measles Outbreak

5 Things to Know About the Measles Outbreak

Written by Nathaniel Weixel, The Hill

The number of new measles cases in the country is on the rise, with the U.S. on track to have its worst year since public health officials declared the disease eliminated in 2000. As of Thursday, the current outbreak has sickened 555 people across 20 states.

And as memories of previous measles outbreaks have faded, the anti-vaccine movement has made a comeback amid the group’s concerns over vaccine safety.

All of that has set up a clash that involves public health departments, schools, religious communities and even Congress.

Here are five things to know about the measles outbreak.

States are taking the lead on prevention

The measles virus has been spreading primarily among pockets of unvaccinated children. The sharp increase has prompted a pushback against state laws that allow people to opt out of vaccinating their children for moral or religious reasons.

Almost all states grant exemptions for people who have religious beliefs against vaccinations, with 17 states making exceptions for both religious and personal or philosophical beliefs.

In Washington, where there have been 74 confirmed measles cases, state lawmakers are advancing a bill prohibiting philosophical exemptions for the measles, mumps and rubella vaccine. The measure passed the House earlier this year, and was recently sent to the Senate.

On the East Coast, Maine’s legislature is awaiting floor votes in both chambers for a bill that would eliminate all nonmedical exemptions. A similar proposal is advancing in Oregon, despite strong anti-vaccine sentiments in parts of the state.

Arizona Gov. Doug Ducey (R) has promised to fight legislation that would expand exemptions in the state, which already has exceptions for religious and personal reasons.

Anti-vaccination movement is under pressure

The outbreak has shined a light on opponents of vaccinations.

“The anti-vaccine lobby has grown from a fringe group to one with its own media empire,” said Peter Hotez, dean of the National School of Tropical Medicine at Baylor University’s College of Medicine.

He said the anti-vaccine lobby is spreading misinformation, mostly unopposed, and the numbers of people becoming sick have reached a tipping point.

And the U.S. is not alone. Measles is spreading across the world, and this year the World Health Organization for the first time declared vaccine hesitancy as a top 10 threat to global health.

Anti-vaccination activists have likened public health measures, like banning unvaccinated children from schools, to the Nazi persecution of Jews.

Del Bigtree, chief executive of an anti-vaccination group called ICAN, wore a yellow Star of David at a rally in Texas last month.

His actions were criticized by the Anti-Defamation League and by officials at the Auschwitz memorial in Poland.

“It is simply wrong to compare the plight of Jews during the Holocaust to that of anti-vaxxers. Groups advancing a political or social agenda should be able to assert their ideas without trivializing the memory of the six million Jews slaughtered in the Holocaust,” said Jonathan Greenblatt, chief executive of the Anti-Defamation League.

Outbreaks concentrated in specific groups

As of April 8, New York City has confirmed 285 measles cases in Brooklyn and Queens since the outbreak began in October. Most of the cases have involved members of the Orthodox Jewish community.

The outbreak prompted New York City Mayor Bill de Blasio (D) and public health officials to declare a health emergency and mandate that families get children vaccinated against measles or pay a $1,000 fine.

Hotez compared the outbreak among the Orthodox Jewish community to a similar measles outbreak among Somali-Americans in 2017 in Minneapolis, when the state confirmed 79 cases, the most in 30 years.

According to the Minnesota state health department, more than 80 percent of the cases involved unvaccinated Somali-American children, whose parents had long been recipients of anti-vaccine propaganda.

Congress is focusing on social media

Lawmakers on both sides of the aisle are looking into how the disinformation campaigns are able to spread so quickly, and they are setting their sights on social media.

“There is a lot of misleading and incorrect information about vaccines that circulates online, including through social media,” Sen. Lamar Alexander(R-Tenn.), chairman of the Senate Health Committee, said at a recent hearing on Capitol Hill.

“Charlatans and internet fraudsters who claim that vaccines aren’t safe are preying on the unfounded fears and daily struggles of parents, and they are creating a public health hazard that is entirely preventable,” Alexander said.

House Intelligence Committee Chairman Adam Schiff (D-Calif.) in February pressed Google CEO Sundar Pichai and Facebook CEO Mark Zuckerberg on the issue.

Schiff said he is concerned that YouTube, which is owned by Google, and Facebook, which owns Instagram, are “surfacing and recommending messages that discourage parents from vaccinating their children, a direct threat to public health, and reversing progress made in tackling vaccine-preventable diseases.”

But so far, there have been no legislative solutions proposed, and tech companies have voluntarily begun policing themselves.

For example, Pinterest late last year began suppressing search results on vaccinations. YouTube said it would begin removing videos with “borderline content” that “misinform users in harmful ways.”

Measles can have short- and long-term health effects

According to the Centers for Disease Control and Prevention, up to 90 percent of people who are not immune will become infected if they are exposed to the virus.

For every 1,000 children who get measles, one or two will die from it. Death rates from measles have plunged with vaccination, but that could change if vaccination rates decline further.

The disease can also have long-term health effects. About 10 percent of children with measles also get ear infections that can result in permanent hearing loss.

As many as one out of every 20 children with measles gets pneumonia, the most common cause of death from measles in young children.

Some rare complications are more serious: About one in 1,000 people in the U.S. with measles develop encephalitis, or brain inflammation, that can lead to convulsions and leave the victim deaf or with an intellectual disability.

Deep in the Heart of Taxes

Written by Joel Fox, Editor and Co-Publisher of Fox and Hounds Daily

Tax day arrives in California with a large state budget surplus, a poll showing that 95% of likely voters don’t want higher taxes, yet a legislature full of proposals to raise taxes. We might reverse that old revolutionary cry of “No Taxation Without Representation” to “More Taxation Through Representation.”

The litany of tax increase proposals is long. Guns, soda, tires and water all face tax increase proposals. Then there are the ideas to tax business with greater corporation taxes and an oil and gas severance tax. Let’s not forget the estate tax proposal. There is also a measure to make it easier to raise local taxes. I probably missed some.

Of course, proponents behind all these tax increases say it’s for a good cause. And, in some cases the causes are just—but are the tax increases necessary when the state is sitting on a near-record surplus?

California already has the highest income and sales tax rate in the country and the corporate tax would be tops if the corporation tax proposal passes. But, legislators want to pile on. The California Tax Foundation estimated that $6.2 billion a year in higher taxes and fees have been introduced and the press release revealing that figure declared that the estimate was actually LOW. The calculation didn’t include additional taxes that will come with amendments to bills or the idea of a service tax, which has been proposed in a spot bill but carries as yet no numbers on what it would cost. A total of 40 bills were introduced that contained higher taxes and fees.

Meanwhile, the Public Policy Institute of California’s most recent poll asked likely voters if they were satisfied with the amount of taxes they pay. Only 4% said they should be paying more taxes. 40 percent said they pay much more than they should, 23 percent said they pay somewhat more, and 32 percent said they pay about the right amount.

Are California’s elected officials truly representing the wishes of their constituents when it comes to raising taxes?

Californians may have an even greater distaste for taxes after they finish calculating what they owe the federal government. Tax law changes reduced the deductibility of state income and property taxes meaning in a high tax state like California many taxpayers will be paying more federal taxes while feeling the effects of those high California taxes. So far, negative attitudes have been aimed at the federal tax law for this situation, but the idea that high state and local taxes led to this condition is bound to set in.

So what will become of all these tax increase proposals? Will new governor Gavin Newsom be more willing to add to the state’s tax burden than his predecessor, Jerry Brown? Will they all pass? Certainly not.

But the push for tax increases will continue…until it crosses the line of Tax Revolt, not an unknown phenomenon in California.

More Taxes on the Way?!

Written by Loren Kaye, CalChamber

April 15 was Tax Day, you’re probably breathing a sigh of relief.

Just don’t get too relaxed.

More than $15 billion in tax increases – mostly aimed at business taxpayers – await hearings and decisions in the Legislature. If the tax proposals get that far (they require two-thirds approval by the Legislature), then new Governor Newsom will have his say.

California’s treasury is awash in surplus revenues, more than $13 billion when the Governor introduced his budget in January, which is on top of a nearly-filled Rainy Day Reserve. Economic growth signals remain strong. And we haven’t seen the last of budget-brimming Silicon Valley IPOs that will boost revenues even more.

The response to this bounty of good fiscal news? Raise taxes!

Record budget surpluses have been met with record tax increase proposals. Here’s just a taste:

Massive corporate tax increase. A state senator is proposing one of the steepest corporate tax increases ever contemplated in California. It would bring the top tax rate for some companies to an eye-popping 22.26%, about 150% higher than today’s rate. It would make the California corporate tax rate easily the highest in the nation.

Were this $5 billion tax increase to pass, California would have the highest or second-highest tax rates nationally for income taxes, corporation taxes, sales taxes and motor vehicle fuel taxes.

While the author means this bill to attack alleged wage disparities and foreign outsourcing, it would likely have little effect on those objectives and more likely have the easily-anticipated effect of harming workers in California or elsewhere in the United States.

While CEO compensation is a favorite topic of class warriors, this legislation ignores the enormous responsibility placed on these individuals to maintain or improve the success of a company that creates jobs for hundreds or thousands of workers, and value for thousands of shareholders, including pension funds.

Companies have also been reshoring jobs from overseas steadily since the beginning of the recovery, with more than a half million jobs returning since 2010 because of better access to skills, favorable transportation or marketing needs.

A $5 billion tax increase cannot just be waved away by corporate taxpayers. This bill would increase revenues from this source by about a third, but would fall on just a small percentage of corporate taxpayers. The malignant effects inevitably would include reduction of workforce or constraint in workers’ pay or benefits. Another outcome could be a reduction in the value of the company, which would affect shareholders. Note that more than 20 percent of household assets are in stocks, and retirement plans own a majority of corporate stock.

Corporate tax revenues in California are at record highs, having increased by 80 percent since 2012. Federal tax reform broadened the corporate tax base and has generated more revenues for the state, and on a parallel track, the Governor has proposed further conformity to the federal tax law to bring in even more revenues.

New taxes on food, farmers and innovation. Another Senator will be proposing to eliminate a dozen tax incentives and exemptions, raising at least $8 billion in general revenues. The key changes: (1) eliminating the sales tax exemption for meat and fish, for animal feed and medicine, and for plants, seed and fertilizer used for food production, (2) eliminating tax credits that encourage companies to create innovation in California, and (3) eliminating a longstanding separate tax benefit for small business pass-through organizations (called Subchapter S firms) to help the owners minimize double-taxation.

California hasn’t taxed food for generations, or what’s necessary to grow food, so now is the right time to hit low income consumers the hardest? That one is a head-scratcher.

This bill would also repeal the research and development tax credit, which rewards innovative activity in California, which in turn is the main engine for small business growth and the creation of well-paid, middle class jobs.

According to the Milken Institute, innovation is crucial for the creation of high-quality jobs and strong economic growth, and in the global race for innovation, California enjoys advantages that others envy. California’s research credit is a crucial part of the tax environment that businesses evaluate in choosing whether to site new research activity in California or in another innovation hub.

Exhumation of the California death tax. Repealed by voters in 1982, another state senator has proposed imposing a new inheritance and gift tax at a 35% rate, on estates valued at more than $3.5 million, up to the point where the federal inheritance tax kicks in. The tax would in effect step into the void vacated by the federal tax reform, which upped the estate exemption to $11.4 million . This bill would directly affect many small business and farm owners who seek to pass along their businesses to family. The tax base is not indexed for inflation, so as time goes on will capture more estates of lower value.

But wait, there’s more. In the category of products that are unpopular or unfashionable:

  • A new tax on sweetened soft drinks, targeting a single product to pay for health programs that have many causes and beneficiaries.
  • A new tax on oil and gas produced in California that will increase costs, prices, carbon emissions, out-of-state oil imports, and cut jobs in the hard-pressed San Joaquin Valley.
  • A new tax on pain-killer pharmaceuticals, which will increase costs and potentially reduce availability of drugs for some of patients who most need pain medication.
  • A new tax on tires to pay for water pollution that comes from many sources.
    Lurking in the background and awaiting launch: a new tax on business services.

Newsom weighs wildfire liability law, but no commitment

Written by Kathleen Ronayne, Associated Press

SACRAMENTO, Calif. (AP) — Gov. Gavin Newsom said Friday, April 12, that lawmakers should consider changing California’s strict law that makes utilities pay for wildfire damage caused by their equipment, regardless of fault, a controversial proposal that has failed to gain traction in the past.

“We’re in real trouble right now as it relates to these utilities being vulnerable to bankruptcy and liquidation,” Newsom said, though he declined to take a firm position on whether the law should be changed.

Instead, he challenged lawmakers to put wildfire-related bills on his desk within 90 days. His comments came as he released a 58-page report from a “strike team” of government and outside experts that outlined California’s stark reality as wildfires worsen.

Pacific Gas & Electric Corp., the nation’s largest utility, filed for bankruptcy in January and California’s two other investor-owned utilities, Southern California Edison and San Diego Gas & Electric, recently had their credit ratings downgraded, which could make it harder to access capital and pay for equipment upgrades.

Newsom and lawmakers are looking for a way to keep the utilities financially stable without leaving wildfire victims and customers on the hook for billions of dollars in damages from recent deadly wildfires, but mindful that the solution not be seen as a bailout for PG&E, which has often been slow to address its problems.

Lawmakers have repeatedly debated the liability standard, including as recently as last year, when they ultimately abandoned the idea in favor of a process that makes it easier for utilities to pass on some costs to customers.

The state law that holds utilities entirely liable for wildfires caused by their equipment allows insurance companies and uninsured wildfire victims to sue utilities for damages, so any changes to the law would face strong pushback from those groups and attorneys who represent them. But Newsom argued that keeping the utilities stable is good for everyone.

“Everybody wants someone else to pay for it,” Newsom said. “We all have a burden and responsibility to assume the cost.”

Newsom’s report also suggested creating a fund that utilities could tap in the short term to cover wildfire costs or creating a wildfire compensation fund that utilities and ratepayers would pay into that could be used after particularly devastating wildfires. Republican Assemblyman Chad Mayes has already authored legislation to create a catastrophic wildfire fund.

Senate President Pro Tem Toni Atkins called Newsom’s report “thorough, substantive and well-researched” and noted that lawmakers already debated some of his ideas last year.

Democratic Sen. Ben Hueso, chairman of the Senate’s energy and utilities committee, said the utilities’ financial trouble requires “urgent, and potentially some unpopular, actions.”

Credit rating agency Moody’s said some elements of the report could help utilities’ credit, but its full effect won’t be known until the Legislature acts.

Two of California’s deadliest and most destructive wildfire seasons hit in 2017 and 2018, with 85 killed in a single Northern California wildfire last November. Insurance losses for that fire topped $8 billion. Officials haven’t determined a cause, but PG&E has acknowledged its equipment likely sparked the blaze.

Newsom had harsh words for the utility Friday, saying he’d keep every option open, including a takeover of the utility or a move to split it into smaller entities.

He called on the utility to “no longer misdirect, manipulate, mislead the people of this state.”

The report said any changes in utility liability rules should give incentives to utilities to invest in safety and, critically, impose penalties for failing to do so. It said any changes also must continue to hold shareholders rather than customers, responsible for safety failures and suggested adjusting how much profit utilities and their executives can make based on their wildfire safety performance.

The report also recommended discouraging new development in high-risk fire areas, where California’s housing crisis has pushed residents seeking affordable housing into once-rural areas. The report urged the state to encourage building in urban and low-risk areas for those who would otherwise be shut out.

Newsom’s “strike team” included representatives from state agencies including the Public Utilities Commission, Department of Insurance, Office of Emergency Services and the California Department of Forestry and Fire Protection.

Newsom has hired the high-powered law and investment firms O’Melveny and Myers and Guggenheim Securities to provide expertise at a cost of more than $6 million over six months, according to contracts obtained through the California Public Records Act.

City Holds Contest

City Holds Contest for 150th Anniversary Logo

Rachelle Bedell, City of Gilroy Community Engagement Coordinator

[Gilroy, CA]- Gilroy will be celebrating a historic milestone next year as March 12, 2020 marks the 150th anniversary of incorporation for the city. In preparation for the celebratory year, the City of Gilroy Arts and Culture Commission is hosting an Art Logo Contest. The winning design will be used in commemoration of the City’s 150th birthday through various mediums and at various celebratory events throughout the year.

When asked about the logo contest, Mayor Velasco stated, “We are excited to celebrate the 150th anniversary of incorporation of the City of Gilroy and are in the process of planning celebratory events and activities for the whole community. The 150th logo will play a significant role in commemorating this historical event and gives our community an opportunity to share, through art, what they value most about our community.”

Wendy Sue Kissa, Arts and Culture Commission Chair added, “The 150th anniversary provides an opportunity for all ages and organizations to celebrate with us! We invite all artists, including professional, pre-professional, and aspirational to participate in designing a logo representing the best of Gilroy.”

The contest opens for entries on April 15, 2019 with all entries due by 5:00 PM on Friday, May 31, 2019. Information about the contest including Official Contest Rules and the Official Entry Form are available online at www.YourVoice.cityofgilroy.org. Entries should be submitted online through this website or dropped off in person at the Recreation Department Office at Gilroy City Hall located at 7351 Rosanna Street.

What’s New with Business

Eric Howard, Business Relationship Manager, Gilroy Chamber of Commerce

Pacific Ocean Water Sports is a new scuba diving center, located at 431 First Street in Gilroy, offering scuba training and certifications for both cold and warm water. They also offer scuba gear sales and service, air fills and tank service, and scuba expeditions to the world’s best dive destinations. Owner Mauri Muñoz can be reached at 408-713-1211 or via Instagram and Facebook @garlicdivers. Mr. Muñoz is a PADI and NAUI scuba diving instructor with over 35 years of scuba diving experience. He teaches all recreational scuba certification levels from open water diver to divemaster and instructor.

Building on the success of last year’s first-ever Garlic Chef Jr. Cooking Competition, the contest will return on Friday, July 26 at the 2019 Gilroy Garlic Festival. Young chefs are encouraged to apply by May 1 to compete on the Garlic Cook-Off Stage. MasterChef Season 9 Winner Gerron Hurt will serve as emcee for the event. Aspiring young chefs age 9 to 18 (as of July 26, 2019) are invited to apply for the 2019 competition by completing the online application at gilroygarlicfestival.com. Applications must be submitted no later than May 1, 2019. For more information, visit gilroygarlicfestival.com.

Capo’s Night Club and Restaurant opened in Downtown Gilroy on April 12, 2019. Plans are to have karaoke, comedy and many genres of music. With that said, however, Capo’s will be more than just a night club. Capo’s has a full menu complete with Italian, Mexican and California Cuisine. They are located in the old Strand Theater building, at 7588 Monterey Street, providing ample space for virtually any function. Stop by and sample some of their great food.

South County Tail Waggers’ annual fundraiser is back and better than ever! Local South County heroes – policemen, firemen, influential community members, and more – will be escorting adoptable Tail Waggers down the runway at Guglielmo Winery. Guests will enjoy complimentary appetizers at various food stations along with music, vendors, and a silent auction. Please visit www.sctailwaggers.org to learn how you can purchase the hottest ticket in town.

A Spoon Full of Sugar

Sugar-Sweetened Beverages Focus of Pending Legislation

Written by Valerie Nera, CalChamber

The Gilroy Chamber of Commerce partnered with CalChamber in previous years to oppose additional taxes on sugar-sweetened drinks. At the time, opposition prevailed, but as is normally the case, defeated bills get rewritten and reintroduced. Below is a good example of.

A number of California Chamber of Commerce-opposed bills placing various restrictions on sweetened beverages will be considered by legislative committees next week.

Four bills, including a job killer targeted tax, are the subject of a special order of business on April 9 in the Assembly Health Committee:

  • AB 138 (Bloom; D-Santa Monica): Designated a job killer because it is a targeted tax on sweetened beverages. AB 138 unfairly imposes a targeted excise tax on distributors of sweetened caloric beverages to fund health-related programs for all, which will force distributors to reduce costs through higher prices to consumers or limit their workforce.
  • AB 764 (Bonta; D-Oakland): Marketing Restrictions. AB 764 severely restricts marketing opportunities by beverage companies based on unproven facts regarding the health effects of sugar-sweetened beverages.•
  • AB 765 (Wicks; D-Oakland): Limitations in Advertising. AB 765 interferes with business management decisions on product placement in retail food stores.
  • AB 766 (Chiu; D-San Francisco): Portion Size Limitation. AB 766 unfairly limits the sale of sugar-sweetened beverages to cups of 16 ounces or less. It also imposes penalties by the Attorney General or local government counsel.

Senate Bill

Moving in the Senate is SB 347 (Monning; D-Carmel): Warning Labels. SB 347 increases frivolous liability claims and exposes beverage manufacturers and food retailers to fines and penalties by mandating state-only labeling requirements for sugar-sweetened drinks.
SB 347 is conceptually the same as legislation from 2014, 2015 and 2018 that failed to pass the Assembly. The text and scope of the warning proposed in SB 347 is similar in many respects to San Francisco’s warning label law, which was declared unconstitutional on January 31 in a unanimous decision of the 11 judges of the U.S. Court of Appeals for the Ninth Circuit.
SB 347 was approved by the Senate Health Committee on March 27 on a vote of 5-1, and is scheduled to be considered on April 8 by the Senate Appropriations Committee.

Avoid Unnecessary Lawsuits

Gilroy Chamber Partners with CalChamber to provide Legally Required Training

Effective January 1, 2019, a new California law requires all California employers with 5 or more employees to provide sexual harassment prevention training. The law requires supervisors to receive two hours of sexual harassment prevention and abusive conduct training while nonsupervisory employees to receive at least one hour of training. The law also requires the training to occur in the 2019 calendar year, before January 1, 2020. The minimal count of “5” employees covers seasonal and temporary hires, including independent contractors.

It is important to note, the California Department of Fair Employment and House takes the position that employees, including supervisors, who were trained in 2018 will need to be retrained again in 2019.

Discount to Gilroy Chamber Members

The Gilroy Chamber of Commerce has partnered with CalChamber to provide online sexual harassment prevention training courses. As a member of the Gilroy Chamber of Commerce you receive a 20% discount. To learn more, click here.

Important Additional Information

  • By January 1, 2020, employers with at least five employees must provide: (1) at least two hours of sexual harassment prevention training to all supervisory employees; and (2) at least one hour of sexual harassment prevention training to all non-supervisory employees in California within six months of their assumption of either a supervisory or non-supervisory position. The training must be provided once every two years.
  • Employers must provide sexual harassment prevention training to temporary or seasonal employees within 30 calendar days after the hire date or within 100 hours worked if the employee will work for less than six months. In the case of a temporary employee employed by a temporary services employer (as defined by the California Labor Code) to perform services for clients, the training must be provided by the temporary services employer, not the client.
  • The anti-sexual harassment training may be conducted with other employees, as a group, or individually, and broken up into shorter time segments, as long as the two-hour requirement for supervisory employees and one-hour requirement for non-supervisory employees is reached.

To receive a 20% discount on the required sexual harassment prevention training, click on the link below and get started immediately.

Gilroy.org/HR Corner

Jobless Rate Drops

Jobless Rate Drops to 49 Year Low
Written by Reade Pickert, Bloomberg 

Filings for U.S. unemployment benefits unexpectedly dropped, falling to the lowest level since October 1969 and suggesting little sign of cooling in a tight labor market.

Jobless claims decreased to 196,000 in the week ended April 6, Labor Department figures showed Thursday. The level fell below all estimates in Bloomberg’s survey of economists, which had called for an increase. The four-week average, a less-volatile measure, declined to 207,000, the lowest since December 1969.

Key Insights

  • The fourth-straight drop in claims indicates the labor market remains historically firm as employers still find it hard to attract and hire workers amid low unemployment.
  • The report comes a day after Federal Reserve officials signaled they’re prepared to move interest rates higher or lower as needed, but an unusual mix of risks means they could remain on hold all year. The March jobs report showed employers added 196,000 jobs, bouncing back from a weak 33,000 advance the prior month.
  • In separate data Thursday, March producer prices excluding food and energy — a key input into U.S. inflation — increased 0.3 percent from the prior month, more than forecast, and climbed 2.4 percent from a year earlier, matching estimates.
  • Elsewhere Thursday, another report showed the Bloomberg Consumer Comfort Index edged up on advances across all three major components, which track views of Americans on the state of economy, personal finances, and the buying climate.

What Bloomberg’s Economists Say

“The labor market is very tight. Jobless claims unexpectedly declined again to the lowest level since 1969. Employers are adding jobs at a pace that is well above the natural growth rate of the labor force and job openings continue to exceed the number of job seekers.”
– Eliza Winger, economist

Get More

  • A Bloomberg survey of economists had forecast claims would rise to 210,000.
  • Continuing claims, which are reported with a one-week lag, dropped by 13,000 to 1.713 million in the week ended March 30.
  • The unemployment rate among people eligible for benefits held at 1.2 percent.
  • The previous week’s claims were revised up to 204,000 from 202,000.

-With assistance by Chris Middleton

Deadly Force

State Dems Divided Over Bill to Limit Police Use of Deadly Force

Written by Laurel Rosenhall, CALmatters

Even as a landmark California bill meant to prevent police shootings passed its first committee Tuesday, the fault lines among Democrats began to emerge, suggesting the measure will likely change as it moves through the Legislature. How much, though, was not yet clear.

After emotional, standing-room-only testimony from Californians whose loved ones have been killed by police, and a sheriff’s deputy who survived being shot by a gunman who killed her colleague, the Assembly Public Safety committee passed Assembly Bill 392 on a party-line vote. But three of the panel’s six Democrats said they were dissatisfied with the bill in its current form. They asked civil rights groups that support the bill and law enforcement groups that oppose it to keep working toward common ground.

“It is incumbent upon each of us to look at the safety of the public, both law enforcement and the community members that are out on the streets every day,” said Assemblywoman Rebecca Bauer-Kahan, a Democrat from Orinda.

“The pendulum has swung too far in one direction such that we aren’t protecting and holding accountable those who are taking life from our community members. I do have serious concerns that the text of this (bill) swings the pendulum too far in the other direction, because the sanctity of the life of our law enforcement is equally as important.”

Assemblywoman Shirley Weber said she would work to reach a compromise before the bill reaches the Assembly floor.

“We are committed to having a piece of legislation that makes a difference and that does provide a balance,” said the San Diego Democrat whose bill would change the legal standard for justifying police use of deadly force.

Her bill—which is backed by the American Civil Liberties Union and numerous civil rights groups—was prompted by the death last year of Stephon Clark. He was not armed, but Sacramento police killed him after mistaking the cellphone he was holding for a gun. Last month, the Sacramento district attorney announced she would not press charges because the officers acted legally.

Clark’s case has re-ignited anger among many that black and brown men are unfairly targeted by police, a message that was carried into the Capitol by scores of Californians who packed the hearing room and spilled out into the hallway, wearing T-shirts commemorating slain loved ones, or emblazoned with the hashtag #LetUsLive.

Weber’s bill would make sweeping changes to the laws that determine when California police can use deadly force. It says police could shoot only when it’s necessary to prevent death or serious injury, and would require they use other tactics in many situations.

That would go beyond the standard set by the U.S. Supreme Court, which says police can use force when a reasonable officer in the same circumstance would do the same thing. Law enforcement groups said that a law that deviates from the reasonable standard would subject officers to greater danger while performing an already dangerous job.

“I was fighting for my life and fighting to protect complete strangers when I chose to stand between the gunman and the employees and patrons. The thought of having to second guess my actions in that moment is frightening,” said Julie Robertson, a Sacramento deputy sheriff who watched her colleague get killed by a gunman when they responded to a disturbance at an auto parts store last year.

“My only intention is to protect and save lives. How is it that I would be questioned and judged by the ones who live so distant from the dangers we inherently face each day?”

Though law enforcement groups are largely opposed to Weber’s bill, several said they would keep working with her to find common ground. Police groups have backed competing legislation, Senate Bill 230, that focuses on updating department policies on the use of force and increasing training for officers. It will likely get its first hearing later this month.

Joining the Griswold's

Jane Howard, Director, Visit Gilroy

More Families Joining the Griswolds

Nearly 100 million Americans Planning a Family Vacation in 2019

AAA projects that nearly 100 million Americans will take a family vacation at some point in 2019.While the figure is slightly higher than last year, it still only represents about four in 10 U.S. adults. According to the recent AAA Travel survey, many families are planning spring and summer road trips.

In fact, more than half (53 percent) plan to take a road trip in 2019. The good news for those families is that gas prices have averaged nearly a quarter cheaper so far this year compared with the first few months of 2018, AAA reported, pointing out that summer gas prices are also expected to be cheaper than they were a year ago.

The AAA Travel survey also found that approximately two-thirds of all family travelers (68 percent) plan to enjoy a summer getaway. However, fewer Americans are gearing up for spring travel, with only 45 percent of family travelers making plans, according to AAA.

“The great American road trip is still one of the best ways for families to relax and reconnect with one another,” said AAA Travel Information & Content executive director Stacey Barber in a statement. “This is quickly shaping up to be another busy year for family travelers, both on the roadways, as well as other popular travel destinations and attractions. To make the most of their vacations, AAA recommends families plan and research as far ahead as possible to avoid missing out on popular activities and fun.”

While planning and budgeting for a family vacation can be daunting and sometimes the biggest obstacle to getting away with your loved ones, there are plenty of tips and tools to make the process fun and easy. The U.S. Travel Associations (USTA) Vacation Planning Tool is very helpful to families. In addition, Visit Gilroy website www.visitgilroy.com has itineraries already created to reduce the stress for families planning a visit to our family-friendly destination.

Granny’s Answer to the Housing Crisis

Written by Matt Levin, Data and Housing Reporter at CALmatters

California lawmakers have pitched dozens of bold, high-profile solutions to California’s affordable housing shortage: billion dollar affordable-housing bonds, revamping the state’s signature environmental protection law, suing NIMBY-inclined cities into permitting more development.

But for all the big-picture housing legislation that has actually become law over the past few years, the solution that’s proved most immediately effective at providing new housing has been rather small in size: Accessory Dwelling Units, colloquially known as in-law units or granny flats.
Primarily as a result of new state laws that make it easier and cheaper to convert garages into living spaces or to build a backyard “casita,” these units have exploded in popularity in many California cities. Los Angeles received 25 times as many applications to build them in 2017 than it did the previous two years; Oakland, San Francisco and San Jose also have seen major jumps.

The backyard units, which are typically around 500 square feet and have a bathroom and kitchen, are especially popular among older California families looking to downsize and rent out their main property. Estimates for the cost of constructing the units vary from builder to builder and city to city, but one survey found an average cost of $156,000 for builders of Accessory Dwelling Units in the Pacific Northwest.

“Now we’re finding dad has died, mom’s there by herself, and all the kids are gone, and they don’t need that big a house,” said state Sen. Bob Wieckowski, Democrat from Fremont, who co-authored legislation in 2016 and 2017 to ease the costs and regulatory hurdles to building such units. Wieckowsi is at it again this year, and predicts that the state could create up to a million new homes with the these accessory units, assuming some important regulatory tweaks.

To Deal with Homelessness

To Deal with Homelessness, California Must Make Room for Sobriety

Commentary by Dawn Davison, Scott Kernan & Michele Steeb

Governor Gavin Newsom is shifting control of the Juvenile Justice Division to the California Health and Human Services Agency, away from the Department of Corrections and Rehabilitation, with the goal to better identify and address early childhood trauma to prevent future incarceration. This same rationale should be extended to the exploding problem of homelessness.

California employs a one-size-fits-all policy for homelessness known as “housing first.” But as we have learned through our work at Saint John’s Program for Real Change, the largest residential program for formerly homeless women and children in Sacramento, homelessness is a complex issue. It requires a tailored approach.

Under housing first, men, women and their children are treated identically. They are provided housing as the solution to their homelessness. A house does address the symptoms of homelessness, but it does not address what led them there, including the childhood trauma that many struggling with homelessness have faced.

While housing first has a role in addressing homelessness, it is not viable for people trying to escape the grip of addiction, because the requirement of sobriety is prohibited.
Nor is it a viable solution for their children, many of whom already have suffered significant trauma. Under the housing first model, programs that require sobriety or engagement in life-improvement services are ineligible for government funding.

This is a travesty for people seeking to escape the hold of drug addiction, and a threat to their children. Already traumatized children should not be placed in housing where drug use is permitted.

Housing first was developed under the George W. Bush Administration to address the chronically homeless population, largely single men battling severe mental illness, substance abuse disorder and/or physical disability.

The Obama administration blanketed this policy across all segments of the homeless population. California adopted this policy in 2016.

Utah, also under the rule of this one-size-fits-all approach, is held up as an example of housing first’s effectiveness. But a report by Utah’s Legislative Auditor General counters claims that it has been a resounding success, especially as it relates to families.

This should come as no surprise. It is misguided to presume there is a one-size-fits-all treatment for everyone who becomes homelessness, and it is equally misguided to assume that a policy designed for single men will work for single-mother-led families with children.

California’s Department of Corrections and Rehabilitation learned a similar lesson. Once corrections instituted a gender-responsive and trauma-informed approach, recidivism began dropping. In eight years, female recidivism rates fell by 21 percent.

Women struggling with homelessness confront many of the same issues as women who are incarcerated: trauma, addiction, dysfunctional relationships and lack of education.
They need to be treated with the same gender-responsive, trauma-informed approach. The unique needs of their children also need to be considered.

Saint John’s houses and serves up to 270 women and children each day, approximately 700 women and children annually. We find that 77 percent of our clients struggle with substance abuse, 69 percent have experienced domestic violence, 58 percent suffer from mental health issues, 52 percent have a criminal history, and 50 percent lack a high school diploma.
Saint John’s provides an 18-month residential program that includes substance abuse treatment, mental health therapy, budgeting, high school diploma attainment, and hands-on employment training.

Not surprisingly, their children have adverse childhood experiences, also known as ACEs, with typical scores of four to six. (A score over four drastically increase the risk of heart disease, cancer, likelihood of alcoholism and attempted suicide). Children are provided mental health therapy, one-on-one coaching with an early childhood education specialist, and developmental screening to assess and help them heal past trauma.

Employing gender-responsive and trauma-informed programming will encourage the highest rates of success for the growing numbers of women and children struggling with homelessness.

Dawn Davison, a Saint John’s board member, is a former warden of the California Institution for Women. Scott Kernan is former secretary California Department of Corrections and Rehabilitation. Michele Steeb is chief executive officer of Saint John’s Program for Real Change.

Opinions expressed by the author of this article are his/her own

Charter Schools Under Attack

Commentary by Dan Walters, CALmatters

Elections have consequences, and while some are unintended, one major impact of last year’s California elections is very much intended.

Organizations and wealthy individuals favoring education reforms and charter schools went head-to-head with the California Teachers Association and other elements of the education establishment.

It was a wipeout. The CTA, et al, swept the table, including the elections of Gavin Newsom as governor and Tony Thurmond as state superintendent of schools, and stronger Democratic supermajorities in the Legislature.

And now there are consequences – a frontal assault on charter schools, which the CTA and other unions see as rivals for students and the funds that come with their enrollments.
Newsom has already signed one bill, requiring more transparency in charter school operations, and several others with potentially erosive effects on the charter school movement are moving quickly.

Striking teachers in Los Angeles and Oakland blamed charters for depriving their systems of much-needed state aid and demanded a study that would pinpoint the shift of funds. Newsom readily complied, assigning the job to Thurmond, who’s already made it clear that he endorses the union complaints.

“There has been, for many districts, a significant fiscal impact and loss of revenue directly attributed to the growth of charter schools,” Thurmond told a Commonwealth Club forum moderated by Calmatters education writer Ricardo Cano, citing a report from the left-leaning research center In The Public Interest.

During the forum, Thurmond went on to decry competition for students – a hallmark of charter school advocates, which see competition as driving instructional improvement.

“Here’s my concern: you cannot open charter schools and new schools to serve every single student in our state. If you take the competition approach, that means some students, a lot of students, will be left behind. And again, I don’t believe that that’s what our mission is.”
He added, “So for me, that means that competition is OK in some environments, but when it comes to education we’ve got a responsibility to make sure that every single student gets an education.”

That argument doesn’t meet the test of logic since the kids in charter schools are, in fact, being educated. Parents placed them in charters precisely because traditional schools were failing them.

Moreover, competition can be healthy in education, just as it is in economic and political spheres. It encourages innovation while monopolies tend to be insular, arrogant and unaccountable – see PG&E, Department of Motor Vehicles, etc.

But logic is often a casualty of political rhetoric. Thurmond clearly wants to kneecap the charter movement and is grasping for justification.

The bills now pending in the Legislature would place a cap on charters at their current numbers, make it much more difficult to open new charters and allow school districts to deny charters based on financial impacts – something now specifically barred by current law.
Charter school advocates know they have a fight on their hands, particularly with the election of Newsom, who succeeds a series of governors favorably disposed towards charters as an alternative education pathway.

The California Charter Schools Association, whose member schools educate about 10 percent of the state’s six million public school students, staged a big rally on the steps of the state Capitol last month.

“When charter schools are under attack, what do we do? Stand up, fight back,” the demonstrators chanted.

It appears to be an uphill fight, given the results of last year’s elections. And if charters lose, so will their kids – particularly poor kids – who are just cannon fodder in California’s education wars.

Opinions expressed by the author of this article are his/her own

For Leaders Only

How to Orchestrate Change from the Bottom Up

Article written by Katherine C. Kellog

Organizational change is difficult, no question about it. It’s challenging to get people who are set in their ways to go about their jobs differently. So what types of interventions might actually change people’s behaviors in ways that make change more palatable?

To answer that question, I conducted a two-year ethnographic study of the primary-care departments in two U.S. hospitals. The hospitals were part of the same parent organization, did similar work, and employed doctors and clinical staff with similar backgrounds. In addition, both hospitals had received grants of $750,000 to implement a change within their organizations: patient-centered medical home (PCMH) reforms that are being rolled out across the United States. PCMH requires primary-care doctors to change their daily work practices by moving from reactive care to prevention (vaccinations, pap smears, mammograms, colonoscopies, and so on) and by using evidence-based guidelines to treat patients with chronic illnesses like diabetes.

I observed the day-to-day work at both hospitals for three months before the start of their PCMH initiatives. Specifically, I studied the interactions between managers, doctors, and medical assistants, since they were the key players involved in the day-to-day changes in line with the reforms. I observed them as they engaged in activities such as “huddling,” where doctors and medical assistants discussed the conditions and progress of patients coming in for office visits that day, and strategic planning meetings, in which managers, doctors, and medical assistants talked about how to best implement the reforms.

After the PCMH reforms were introduced, I continued observing those interactions for the next two years. In total, I shadowed and interviewed 48 doctors, 10 managers, and 24 medical assistants. I also analyzed documents, including PowerPoint presentations, clinic paperwork, and other materials that the managers developed to facilitate the implementation of PCMH.

Initially, a small number of doctors were adamantly opposed to the PCMH reforms, while the majority believed the changes had merit. Even for those who had a positive view of PCMH, however, many felt the reforms might run counter to their ability to apply their specialized expertise to help the ill, and to use their discretion and autonomy to treat patients. In other words, while widespread pushback wasn’t common, some degree of resistance was.

In the end, managers at one hospital were much more successful in changing their doctor’s behavioral practices than were managers at the other hospital. Specifically, across three phases of the study, the adoption rate for PCMH practices at the successful hospital soared from 6% to 65%, while the rate at the other hospital remained relatively flat from the initial low 6%. Why the huge difference?

From an analysis of the data, I was able to identify the most significant factor: On the teams that were most successful, managers had enlisted the aid of medical assistants to help change the doctors’ behaviors. At both facilities, the medical assistants were responsible for bringing patients from the waiting area to the exam room, weighing them, and taking their blood pressure. And yet despite having no formal authority over doctors, the medical assistants had a high capacity for influence because they had a lot of structural power.

First, the medical assistants occupied a central position in the doctors’ workflow. They could both remind doctors to implement new practices such as delivering particular vaccinations, and could give doctors opportunities to review and approve suggested changes before they were implemented.

Second, they performed tasks that were critical to doctors’ daily work, making it relatively easier for them to ask the doctors for favors; this led doctors to see themselves as implementing the new practices to help their medical assistants rather than to meet managerial demands.

Third, the medical assistants were central in the doctors’ peer network, enabling them to spread the word about those doctors who had adopted the new practices.

And fourth, they were positioned between the patients and the doctors, so they could suggest changes in doctors’ practices while also shielding doctors from the emotional challenges of upset or angry patients.

But it wasn’t just that the medical assistants had a lot of structural power; they were given specific tools to leverage this structural power to persuade the doctors to implement PCMH. Specifically, the managers at the successful hospital provided the medical assistants with things like visual prompts, which helped indicate whether a particular patient was due for a certain procedure or test. For example, each patient packet included a purple checkout form, in which the medical assistants could mark any required colonoscopies or mammograms as a helpful reminder to the doctors. “The purple sheet is helpful,” said one doctor. “There is so much going on [at the time of the visit] that it’s good to be reminded.”

Another effective tool was “favor scripts” provided to the medical assistants. One script was to help persuade doctors to implement a particular reform for treating diabetes. In the script, medical assistants would pose the change as something a doctor could do as a favor to them (“It’s very helpful for me if you would…”) as opposed to being a policy imposed by management (“We need to do this…”). As one medical assistant recalled, “I told [doctor] that when patients are on the list, I need to keep managing them, and that takes time. Finally, she said she would do the [lipid panel checks] to get those patients off the list for me.” In other words, the doctors viewed themselves as helping the medical assistants and, as one doctor noted, “We want to keep the MAs happy because we depend on them.” Doctors were willing to make changes to help their MAs, as long as these decisions did not run counter to their clinical judgment.

These tools were effective because they significantly lessened the degree to which the reforms threatened the doctors’ expertise, autonomy, individual responsibility for patients, and engagement in complex work.

Importantly, the managers at the successful hospital freed up time for their MAs to engage in the new work associated with influencing the doctors. They also established a two-way dialogue that allowed MAs to tell the managers about the hurdles they were facing and to ask for the resources they needed to address them. For example, it was the traditional practice in both hospitals to cover staffing shortfalls by rotating MAs who had few doctors in session on a particular day from one area of the department to another. With the introduction of PCMH, MAs needed to do offline work to identify which patients were due for vaccinations, pap smears, and the like. When managers rotated MAs, MAs experienced work intensification because they could not use downtime to catch up on this offline work. The MAs discussed amongst themselves and raised this issue with their managers. The managers responded by eliminating rotation of the MAs.

While the MAs at the successful hospital reported that the quality of their work life had improved from using these tactics, they do raise possibility of manager exploitation of semiprofessionals, if used without attention to semi-professionals’ well-being. Future research could explore the costs for semi-professionals that stem from engaging in influence attempts with more powerful professionals on behalf of managers, and how these might be prevented.

While my study investigated two hospitals that were trying to change the work practices of its doctors, I believe the idea of leveraging the structural power of low-level workers to push change from the bottom up has broader implications, especially for other organizations employing professionals. This might include law, accounting, or consulting firms, among others. For example, could a law firm more effectively alter the behavior of its lawyers by enlisting the aid of its paralegals in the change initiative? And might companies do the same with their administrative assistants when implementing organizational change?

Given the dismal success rate of change initiatives at many companies, enlisting low-level semi-professionals to help change the practices of the professionals with whom they work is certainly an approach worth considering.

Katherine C. Kellogg is the David J. McGrath Jr. (1959) Professor of Management and Innovation at the MIT Sloan School of Management. Her research focuses on organizational change and the changing nature of work and employment.

What’s New with Business?

Eric Howard, Business Relationship Manager, Gilroy Chamber of Commerce

James Gargiulo is happy to announce that Spectrum Small Business Advisors, LLC is now a certified Veteran-Owned Small Business (VOSB). He is looking forward to working with other Veterans on government contracts and helping them financially manage their small businesses. He also provides payroll and bookkeeping services to businesses in Gilroy and the Bay Area. James can be reached at (949) 351-1538 for help with your business.

Leadership Gilroy is hosting their 5th Annual Spring Fling Event on Saturday, April 13 from 6:00 pm-10:00 pm at beautiful Fortino Winery. Jaime Rosso will be recognized with the 2019 LIFT Community Leader Award. The evening will include a great selection of wine and beer, with a hosted bar until 8:00 pm. Don’t miss gourmet catering from Kneaded Bakery and live music from cover band Rapture. There will also be amazing auction and raffle prizes available. Spring Fling is open to everyone in the community, so get a group of friends together and join the fun. All proceeds benefit Leadership Gilroy’s annual community leadership training program and providing scholarships to participants. Please visit www.leadershipgilroy.org for tickets.

Tickets for the June 2 Monster Jam, at the Salinas Sports Complex, are available online, via phone or at the window. Tickets range from $14- $42. Tickets are also available via phone or at the window for the July 17 Big Week Professional Bull Riding and the July 18-21 California Rodeo Salinas. Professional Bull Riding ticket prices range from $10 to $55. Contact the ticket office for box seat and season ticket information. Limited tickets for the July 12 Rodeo Kick Off Concert featuring Tim McGraw are available online, at the window or by phone with tickets ranging from $35 to $85. Call 800-549-4989, visiting the Box Office at 1034 N. Main Street in Salinas between 10:00 am and 6:00 pm Monday through Friday or by visiting the following websites: www.salinassportscomplex.com, www.carodeo.com or www.tickets.com. All events listed above will take place at the Salinas Sports Complex at 1034 N. Main Street in Salinas, CA.

Student creativity and learning will be on full display, along with kid-friendly activities at the 13th Annual Summit for the Planet celebration on Saturday, April 27, hosted by Mount Madonna School. This FREE public event runs 11:00 am-1:30 pm and features eco-carnival games, face painting, live wildlife and reptile exhibits, vendor displays & learning expo, pony rides, music and tasty foods, a Trash Fashion show, and view science projects. Summit for the Planet is a great event for the school to raise funds and awareness, also to build stronger, meaningful connections amongst the students. The celebration will spotlight environmental education. For more information, visit www.SummitforthePlanet.org

You can also follow the experiences of the Mount Madonna School senior class during their learning journey to India, which continues through April 7, see the trip blog: india.mountmadonnaschool.org. Here you can see the trip through photos, video and student perspectives. This experience is part of their two-year Values in World Thought Social Studies curriculum.

One Potato, Two Potato…

Article written by Loren Kaye, CalChamber

In just one year, the U.S. government will fulfill its once-a-decade duty to count every American. April 1, 2020 is Census Day.

Armed with a $15 billion budget, the Census Bureau will aim to gather a few key facts about all residents: location, age, race/ethnicity, home ownership, and household members.

For the first time, the agency will try to collect most responses online, with the remainder by mail or, as needed, in person. The Census Bureau is legally prohibited from sharing any personal data collected through the census with anyone, including other federal agencies and law enforcement.

Why is the census important?
First, the census is the sole means to determine how many of the 435 seats in the U.S. House of Representatives are allocated to each state. California currently has 53 seats and would expect to retain that number after the census.

However, if the census is poorly conducted in California and misses many hard-to-reach inhabitants, then the state could wind up losing a seat—and some of our influence—in Congress.

The population counts developed in the census also determine how federal agencies will allocate huge amounts of federal appropriations. In 2016, California received $115 billion in federal funds that were dependent on the state’s population count.

What is the risk of undercounting our residents?
California is uniquely vulnerable to a poorly executed census. The vast majority of Californians belong to groups that historically have been undercounted, such as renters, young men, African Americans, Latinos, immigrants, occupants of nonstandard housing, and the homeless.

In addition, many advocates and public officials are concerned that the proposed addition of a question on citizenship status may discourage immigrants from participating in the census.

Employer Role
Employers will play an important role to encourage their employees to participate in the census.
As trusted leaders, employers have credibility to urge their employees to complete the official census questionnaire by highlighting the importance of an accurate census count to their communities, as well as emphasizing the security of the information they share with the Census Bureau.

The census is conducted only once every 10 years, but it is critical for our democratic representation, fair allocation of federal funds, and to gain insight as to who we are as a state and nation.

California Mandates Advancing

Plastic Recycling Bill – Changes Coming?
Article written by Adam Gegele, CalChamber

Legislation raising serious questions about California mandates on recycling numerous products containing plastics is advancing in both the California Senate and Assembly.

The California Chamber of Commerce has joined a broad coalition that is opposing unless amended both SB 54 (Allen; D-Santa Monica) and AB 1080 (Gonzalez; D-San Diego), titled the “California Circular Economy and Plastic Pollution Reduction Act.”

In their current form, both bills jeopardize in-state businesses with additional costs and provide the California Department of Resources Recycling and Recovery (CalRecycle) with open-ended authority to develop and impose costly new mandates with an unrealistic timeframe on California businesses manufacturing an incredibly broad swath of consumer products.

Coalition members represent manufacturers, small businesses, consumer product companies, food producers, agriculture, retailers and others.

The CalChamber and coalition members agree that more can and should be done to reduce the amount of plastic material that is disposed of in landfills or that makes its way into our creeks, rivers and oceans.

Both the CalChamber and coalition look forward to working with the authors to address these issues with the hope that the final work product will result in a packaging policy that is both environmentally responsible and economically sustainable.

Policy Challenges

Recent policy actions imposed by China and other Asian countries are creating new challenges—but also opportunities—in how plastics and other commodities are recycled and managed domestically.

Collectively, companies have set ambitious sustainability targets and are taking steps to utilize recyclable packaging, increase recycling rates, and incorporate recycled material in the production of new packaging.

In addition, many in the plastics and consumer products industry have announced commitments of $1.5 billion to end plastic waste in the environment through new packaging formats, more efficient recycling technologies, and new business models to create value in used plastic.

Issues with Bills

Both bills raise serious questions, use terms that are unclear and vague, establish implementation timelines that are not practical, and provide CalRecycle with open-ended authority to impose new mandates on businesses operating in the state.

As pointed out in letters to the legislative policy committees:

  • The scope of products affected is unclear due to undefined terms in the bills.
  • Unfettered authority is granted to CalRecycle when clear guidelines and oversight by the Legislature is needed.
  • Practical timelines are necessary. Both bills require CalRecycle to develop an initial scoping plan by January 1, 2021 and manufacturers to meet a 20% recycling rate by January 1, 2022. Data collection, recycling rate calculation, expanding existing collection infrastructure and developing new markets for collected material will take significant time.
  • The requirement to “source reduce” single-use packaging and products is unclear and leaves open the question of how responsible entities may comply. The bills should recognize companies’ source reduction efforts over the years and acknowledge that simply using “less” packaging may not be technically feasible and may conflict with state and federal law.

Key Questions

To ensure the policy achieves the desired objective, key questions the Legislature should assess before finalizing any policy around packaging include:

  • Will this legislation actually reduce waste or rather simply result in replacing one type of trash with another?
  • What are the environmental impacts associated with the manufacture, distribution, use and disposal of likely alternative replacement products?
  • Are likely replacement products recycled or composted within the state’s existing infrastructure and do viable, end use markets exist for these products?

 

Important Considerations

  • Existing law. The new law also should take into account the existing Rigid Plastic Packaging Container law, recognize companies that have met their compliance obligation and ensure that new requirements are not duplicative and/or overly burdensome on consumer product companies that are in compliance.
  • Uniform statewide solution. Some industry sectors are attempting to navigate a patchwork of local ordinances pertaining to food service packaging. Any comprehensive packaging policy adopted by the Legislature should include preemption of local ordinances.
  • Stakeholder involvement. What is being proposed under SB 54 and AB 1080 is a major undertaking and will likely have profound impacts on packaging design and use, and on the consumer product companies that rely on packaging to deliver products to markets.

CalRecycle does not have the expertise in packaging design or in the manufacture or distribution of any consumer products. If this legislation is to be successful, it will require the implementing regulations to be, at a minimum, both practical and technologically feasible. Engagement by industry experts will be essential to achieve this goal.

March 2019

Politicians Partnering with the Gilroy Chamber of Commerce

Politicians from DC to Sacramento Partnering with the Gilroy Chamber of Commerce

Written by Mark Turner, Gilroy Chamber of Commerce President

Washington politicians, Sacramento officials and local electeds will be descending upon Gilroy to discuss policy issues and how they impact South County residents. The Gilroy Chamber of Commerce is hosting the 6th Annual Legislative Summit on Friday, April 26 from 11:00 a.m. to 1:30 p.m at the Hilton Garden Inn located at 6070 Monterey Street.

All of of the elected officials representing Gilroy and South County will be attending the Summit, including, Gilroy Mayor Roland Velasco; Congresswoman Zoe Lofgren; Congressman Jimmy Panetta; State Senator Bill Monning; State Assemblymember Robert Rivas; County Supervisor Mike Wasserman; Morgan Hill Mayor Rich Constantine; and Water District Board Member John Varela.

The cost to attend the Legislative Summit is $45 which includes a 3 course meal. To register go to gilroy.org or call the Chamber office at 408-842-6437.

Attendees will hear from each of the elected officials regarding important issues affecting residents in Gilroy, San Martin and Morgan Hill. There will be a 30-minute Q&A period at the end allowing attendees to ask more pressing questions of our representatives.

The Legislative Summit plays an important role in our community. One year ago, the Chamber was able to coordinate a tour of the GUSD school sites with, then, Assemblymember Cabballero and GUSD officials allowing a discussion to occur regarding the impact high speed rail would have had on certain GUSD sites. Two years ago, the Chamber worked with the City of Gilroy to coordinate a tour of First Street with Senator Moning and Assemblymember Caballero which eventually lead to successful meetings between City and State officials helping to get limited funding to repair parts of the badly decaying pavement on First Street.

The Chamber convenes leaders at all levels of our community and government to create a better quality of life for our residents.

GEDC Monitors Local Economy

Tammy Brownlow,President/CEO, Gilroy Economic Development Corporation 

The Gilroy Economic Development Corporation (GEDC) has spearheaded the city’s economic development activities since 1996. In addition to marketing for business attraction, assisting existing businesses and providing help to start-ups and entrepreneurs, the GEDC tracks the condition of our local economy on a continuous basis. Below are some of the key indicators which demonstrate we are headed in the right direction.

  • Unemployment rate of 3.9% (February 2019) ↓
  • Vacancy rate for industrial properties at 1.5% ↓
  • 21% of Gilroy jobs in retail sector ↓
  • Median household income is $86,742 ↑
  • Consumer spending and sales tax revenues increasing ↑

Gilroy’s unemployment rate is 3.9% as of February 2019, the most recent data available from the CA Employment Development Department. This rate represents a labor force of 30,400 with 29,200 residents employed and is reaching full employment as defined by a majority of economists.

The city’s vacancy rate for industrial property is down to 1.5%, which is an excellent indicator of the economy and business attraction efforts. However, we are running out of space to fill with new companies that typically seek a turn-key solution to relocation and expansion needs.

Although retail is good for our community in terms of sales tax revenues, many of the jobs in this sector are part-time and offer a lower pay scale with no benefits. As we attract companies in other sectors, the percentage of jobs in retail becomes smaller as compared to total jobs across all sectors. This is a positive change as it indicates that we are diversifying our jobs base. Note that the total number of jobs in retail continues to increase with approximately 4,600 employed in this sector.

The median household income for Gilroy residents continues to increase and according to most recent census data is nearly $87,000. For comparison, the median for California is $67,169 and in Santa Clara County the median household income is $106,761.

The city’s sales tax revenue has been back to pre-recession levels for several years. Consumer spending is strong with major gains across all retail sectors, particularly auto sales, department stores and service stations. The city also collects sales tax revenue from e-commerce sales of sellers located outside California. The city’s share is based on a percentage of a county-side pool, which is approximately 4.4% or $707,000 (most recent data available from the city).

The GEDC is Gilroy’s “one-stop” for assistance and resources for companies interested in opening a business in the city. We are available to provide additional information on the indicators discussed above and can provide detailed data on demographics and other economic indicators. Reach us at (408) 847-7611 or email president@gilroyedc.org.

Tax Scams to be Aware of

IRS Releases Common 2019 Tax Scams to Be Aware Of

CalChamber, HR Watchdog

To help businesses and taxpayers prepare for the federal tax filing deadline next month, the U.S. Internal Revenue Service (IRS) is releasing information on 12 common tax scams to be aware of this year.

As many of these scams peak during the filing season, the IRS annually launches a “Dirty Dozen” campaign, highlighting one common tax scam a day to its online newsroom.

The IRS also urges taxpayers to learn how to protect themselves by reviewing safety tips prepared by the Security Summit, a collaborative effort between the IRS, state revenue departments and the private sector tax community.

Dirty Dozen

Some of the 2019 scam schemes featured thus far are:

More Information

To view this year’s “Dirty Dozen” list or view lists from previous years, visit www.irs.gov/dirtydozen.

Potential Litigation for California Companies

Bill Dealing with Environmental Standards Would Create Uncertainty and Increase Potential Litigation for California Companies

March 19, 2019, CalChamber

The California Chamber of Commerce today announced the second job killer of 2019 — SB 1 (Atkins; D-San Diego). The bill would give broad and sweeping discretion to state agencies to adopt rules and regulations that they determine are more stringent than federal rules and regulations adopted after January 19, 2017.

According to CalChamber, SB 1 (Atkins) is a job killer because the uncertainty created by the bill’s vague, ambiguous, and broad language and lack of due process in the rulemaking process would negatively impact the growth, employment, and investment decisions of almost every major California business. Due to costs and anticipated litigation associated with SB 1 (Atkins), companies doing business in the state would be hard pressed to hire more workers or expand California operations.

The proposal seeks to create an expedited administrative procedure not subject to the California Administrative Procedure Act when promulgating emergency rules pursuant to SB 1. Should the measure become law, it will likely instigate a wave of new litigation from interested parties wishing to compel a state agency to perform an act required by, or to review a state agency’s action for compliance with, any of the laws subject to SB 1. Businesses would inevitably be forced to intervene in these lawsuits in order to ensure that their interests are adequately represented.

In voicing opposition to the measure, a coalition of 35 business associations have joined CalChamber’s effort to educate policy makers about the negative impacts of the bill. The coalition’s opposition letter states that “SB 1 is an unprecedented power transfer from the Legislature to the Executive Branch. It is too broadly written, contains ambiguous and undefined standards that will create significant costs, uncertainty and unintended consequences for the regulated community, and raises substantial constitutional concerns regarding a lack of due process and violations to the single-subject rule.” Moreover, the bill circumvents the Administrative Procedures Act by improperly empowering state agencies with limited Legislative oversight, and threatens to undermine wetland regulation efforts currently being pursued by the State Water Resources Control Board, as well as operation of the Central Valley Water Project. The bill will inevitably result in unnecessary litigation against state agencies and regulated entities.

SB 1 (Atkins) is a reintroduced version of last year’s SB 49 (De Leon) — a job killer bill that was defeated in the Assembly. SB 1 (Atkins) is the second bill to be tagged a Job Killer by CalChamber so far this year. On March 4, 2019, CalChamber announced that AB 51 (Gonzalez), a reintroduced version of a previous measure that was vetoed by Governor Brown in 2018, had made the list.

What’s New with Business?

Eric Howard, Business Relationship Manager, Gilroy Chamber of Commerce

Come for the rides, stay for the smiles. Gilroy Gardens opens for the season on Sunday, March 17. Gather the whole family for a spin inside a bright red strawberry, fly above the trees under a giant mushroom swing, or speed around twists and turns on the Quicksilver Coaster. The park is open weekends this spring from 10:00 am to 6:00 pm, plus 11:00 am to 5:00 pm Fridays, starting March 22, 2019. Enjoy Unlimited Adventures. There are no limits to your child’s imagination. Discover unlimited adventures together all season long with a Premium Membership. Get unlimited visits day and night, FREE parking, Bring-A-Friend FREE Fridays, discounts and more for just 5 payments of $13 after an initial payment. For a complete operating calendar and information on all upcoming events, or to purchase your 2019 Value or Premium Memberships, visit www.gilroygardens.org.

The Gilroy Assistance League (GALs) is proud to announce the 15th Annual “Impressions” Home + Garden Tour & Boutique. It’s a perfect outing for Mother’s Day weekend, Friday, May 10 and Saturday, May 11, complete with hors d’oeuvres and no-host wine tasting featuring a Home & Garden Décor Boutique. 100% of all proceeds benefit local youth through grants and holiday giving. Tickets are $35 in advance and $40 at the door. For additional information, leave a message at 408-713-1414, or visit the website at gilroyassistanceleague.org to purchase tickets and find out more.

Love to Cook with Garlic? Enter the 41st Annual Great Garlic Cook-Off Recipe Contest at the Gilroy Garlic Festival. Amateur chefs from around the country are invited to submit their very best original garlic recipes for the 41st annual Great Garlic Cook-Off, one of the most prestigious cooking competitions in the country. Eight finalists will be selected to compete on stage at the Gilroy Garlic Festival on Saturday, July 27, 2019 for the coveted garlic crown and a grand cash prize. Applications must be submitted online by May 1, 2019. Each original recipe must include a minimum of six cloves of fresh garlic or three teaspoons of chopped or minced garlic. The recipes will be prepared on the state-of-the-art Garlic Cook-Off Stage and must be plated and served to a panel of judges in two hours’ time. The winner receives $3,000, with second place receiving $1,500. All contestants also get the opportunity to share the stage with a celebrity chef host, who will be announced in May. Complete contest rules and the online application form are available at gilroygarlicfestival.com/festival/cooking-events/great-garlic-cook-off. Complete contest rules are posted at gilroygarlicfestival.com.

Gavilan Employers Advisory Council (GEAC) is hosting a seminar on “New Laws for Independent Contractors” on March 27, 2019 from 7:30 am -10:00 am. The location is the Hilton Garden Inn, Gilroy at 6070 Monterey Street. To register call 408-216-6145 or email: david.sambrano@edd.ca.gov. The cost is $40/member, $55/non-member.

2019 International Market Blueprints

Jane Howard, Director, Visit Gilroy

Visit California focuses its marketing programs in 13 international markets and the United States. Every year Visit California publishes insights into current market conditions, visitation and visitor spend, tourism trends and more for all these markets. Following is information about the three countries Visit Gilroy markets to in collaboration with Central Coast Tourism Council (CCTC) partners:

Canada

  • The United States remains the top international destination for Canadians by a large margin with over 16 million trips to the U.S. reported between January and September 2018. This represents an increase of 6.4% YOY.
  • 2018 spend by Canadian travelers – $2.266 billion and 1.723 million California visits.
  • Average length of stay in California – 10.5 nights
  • Outdoor recreation is a top experience for Canadians while on vacation. Baby boomers continue to be the primary driver of out-bound Canadian travelers.

 

China

  • U.S. ranks 5th on Chinese visitor Satisfaction Index developed by China National Tourism Administration. Outbound Chinese tourists took 71.3 million trips to the U.S. in the first half of 2018; up 15% over last year.
  • 2018 spend by Chinese travelers – $3.407 billion and 1.6 million California visits.
  • Average length of stay in California – 13.6 nights.
  • Women are more likely to go abroad than men. In 2018, 59% of outbound tourists were women while 41% were men. Family travel accounts for the highest portion of travel at 30% while solo travel is 8%. Digital transaction methods are a must especially for young travelers.

 

United Kingdom

  • Despite uncertainty over Brexit and the strength of the pound against the euro and dollar, the British public are resilient holidaymakers. U.K. consumers are becoming more environmentally aware and responsible.
  • 2018 spend by the British – $1.097 billion and 746,000 California visits.
  • Average length of stay in California – 11.1 nights
  • 40% of millennials (22-35-year olds) now take social media into consideration when choosing holiday destinations. Even the chance to post local delicacies in exotic locations on platforms like Instagram is influencing millennials’ choices.

 

Next month, I will be meeting with Visit Gilroy CCTC advertising partners in Monterey at our annual retreat to review the Visit CA 2019 Market Blueprints and discussing our coop marketing plans for the upcoming year. With access to Visit California research such as these market blueprints, marketing decisions can be made with more certainty and confidence.

Regulations Withdrawn

New Criminal Background Checks Regulations Withdrawn

Written by Erika Frank, Executive Vice President, Legal Affairs, and General Counsel – CalChamber

Sometimes the California legislative and rulemaking processes feel like the 1993 movie “Groundhog Day,” where the same day repeats over and over again. The California Department of Fair Employment and Housing Council’s (FEHC) efforts to adopt regulations concerning criminal history checks is one good example.

Back in 2016, the FEHC proposed its first round of criminal background check regulations. The Office of Administrative Law (OAL) approved these regulations, which took effect on July 1, 2017, just as the California Legislature was considering its own changes on employer criminal background checks. Governor Brown signed AB 1008, which addresses how employers may use prior criminal history information in employment decisions.

When the law went into effect on January 1, 2018, California employers had to make sweeping changes on how they conduct criminal background checks. The “ban-the-box” bill:

  • Eliminates questions about criminal history and applicant consent to conduct criminal history checks on employment applications;
  • Prohibits criminal background checks until after a conditional offer of employment; and
  • Creates notification requirements.

California law was now very much out of sync with the FEHC’s newly enacted Department of Fair Employment and Housing (DFEH) regulations – so the FEHC went back to the drawing board.

In early 2018, FEHC started another round of rulemaking and proposed a revised set of criminal history regulations. These new proposed amendments to the Fair Employment and Housing Act (FEHA) also went through the same regulatory process and was submitted for approval to the OAL. However, unlike the 2017 amendments, the FEHC withdrew their proposed regulations, which means the rulemaking process must continue.

What does that mean for employers? The latest regulatory amendments are not approved and the FEHC must start, yet again, another round of rulemaking before a revised set of criminal history regulations are added to California’s collection of laws and regulations.

Newsom Delays Threat

Newsom Delays Threat to Block Transportation Funds to Cities That Flunk Housing Goals

Written Liam Dillon – Los Angeles Times

In his first week in office, Gov. Gavin Newsom sent a strong warning to cities and counties: He was coming for their road repair dollars if they didn’t meet state goals for new housing.

“If you’re not hitting your goals, I don’t know why you get the money,” Newsom said when he announced his budget plans in January.

Two months later, Newsom is setting aside plans to withhold state transportation dollars from local governments for four years. The move, which comes after fellow Democrats pushed back on the idea, is part of a larger acknowledgment that revamping how California plans for growth will be more arduous than the governor implied on the campaign trail.

Newsom made the announcement Monday when he unveiled a new bill that will be debated as part of the state budget. The legislation calls for $750 million in new funding for cities and counties to plan for increased housing production and then receive financial rewards as new building occurs. The money would begin flowing, according to the bill, in August.

Our state’s affordability crisis is undermining the California Dream and the foundations of our economic well-being,” Newsom said in a release.

But the bill released Monday also laid out a lengthy timeline for the governor to implement more contentious parts of his housing agenda.

As a candidate, Newsom called for the building of 3.5 million new homes in the state by 2025, an amount that would more than quadruple the current rate of production.
For five decades, the state has required cities and counties to plan for housing production at a rate sufficient for all residents to live affordably. But the process hasn’t resulted in nearly enough homebuilding, especially for low-income residents, to meet demand.

Newsom pledged to reset housing supply goals so cities and counties would have to set aside more land for housing, concentrate production in existing urban areas to support climate change efforts and receive greater financial incentives to actually approve development. California’s tax system generally provides local governments with more tax revenue if they authorize hotel or commercial projects instead of housing.

Under Newsom’s new proposal, the state could take until 2023 — after the governor’s first term in office has ended — to put the new housing supply goals in place. When he unveiled his budget in January, Newsom also said he wanted to withhold money from the state’s recently approved increases to the gas tax and vehicle registration fees from communities that blocked housing. The bill says that wouldn’t happen until 2023 as well.

Giving new money to cities and counties before implementing new planning rules is an effort to show local governments that the governor sees their support as vital to meeting his housing goals, said Jason Elliott, Newsom’s chief deputy cabinet secretary.
“The best way to do that is to work with cities,” Elliott said.

When Newsom first announced his plans to tie transportation funding to housing goals, he didn’t provide a timeline. But some Democratic lawmakers made clear they weren’t fans.
At a budget committee hearing last month, Assemblywoman Cecilia Aguiar-Curry (D-Winters) noted that voters upheld the gas tax hike at the ballot last year and said the governor shouldn’t consider restricting that money.

“We worked too hard on that and to all of a sudden have that used as a potential is disturbing to me,” Aguiar-Curry said.

It’s unclear if pushing off the plan for four years will lessen legislators’ concerns.
Sen. James Beall (D-San Jose), who authored the gas tax increase in 2017, said in a statement after the bill was released Monday that he remains against linking road construction funds to housing supply goals.

“Their use for any other purpose, such as to be used as leverage, is a violation of the trust of the voters and taxpayers,” Beall said.

Could Unelected Appointees Increase Your Taxes?

Push to Create a Regional Housing Agency for the Bay Area

Written by Guy Marzorati, Reporter and Producer for KQED News 

State lawmakers are proposing to create a housing agency for the San Francisco Bay Area, with the ability to impose regional taxes to fund development, local planning and tenant assistance.

The legislation, set to be unveiled on Thursday, would create a new agency to address a problem felt by residents in all of the region’s nine counties. Assembly Bill 1487 is the cornerstone of a controversial regional housing agenda being pursued at the state Capitol.

“It is central to what we’re trying to do with a regional approach,” said Assemblyman David Chiu, D-San Francisco, who authored the bill.

The idea for the regional entity — dubbed the Housing Alliance for the Bay Area (HABA) — was birthed from CASA, a committee of elected officials, developers and affordable housing advocates who drew up a set of ideas to ease the housing affordability crisis in the Bay Area.

The ideas included emergency rent and legal assistance to tenants facing eviction, a regional rent cap, streamlined approval for more developments and minimum zoning standards for housing around transit stops. Many of those ideas have already been introduced in the state Legislature.

The committee also drafted a price tag for their list of solutions: $2.5 billion annually over the next 15 years.

AB 1487 would give state authority to HABA to raise up to $1.5 billion through ballot measures voted on in all nine counties.

“[It] would allow for funding to be raised regionally and spent regionally,” Chiu said. “It would allow tenants from across the region to access services, even if their city doesn’t have tenant services available. It would allow cities across the region to get access to technical assistance that they may not already have.”

The entity would not have any land use authority, and while it could purchase land for affordable housing, it would not be able to take property through eminent domain.

AB 1487 proposes that the governing body be split between local mayors, council members and supervisors who serve on the Metropolitan Transportation Commission (MTC) and the Association of Bay Area Governments (ABAG), along with appointees of the governor.

Even some supporters of CASA have argued against the creation of a new housing government, particularly one that could include unelected appointees.

“I don’t personally think having a separate agency is necessary, given that we have ABAG and MTC, which is made up of elected representatives from throughout the region,” said Berkeley Mayor Jesse Arreguin in January, when ABAG reviewed the regional housing ideas. “I think that’s a role that we can play as the regional planning entity.”

It would be up to the Alliance to determine what tax proposals end up on the ballot.

The CASA Compact suggested a suite of ideas, including a regionwide parcel tax on property owners, a new fee on developers, increased taxes on businesses, a regionwide sales tax increase and direct contributions from local governments.

Supporters say the regional approach to taxes would ease the burden on cities that currently have to go to the ballot individually to raise funds for housing.

They point to measures to fund affordable housing in San Jose and Santa Rosa that failed in the November election.

HABA’s plans for spending the tax money — sending cash and legal assistance to tenants, buying properties to build affordable units, and paying for planners to help cities prepare for development — could be particularly helpful to cities and towns that lack the resources to take on those initiatives now.

“Some jurisdictions have a lot of staff and revenue but there’s a wide range within the region,” said Amie Fishman, executive director of the Non-Profit Housing Association of Northern California. “So having a regional strategy will also help to generate the local solutions that are needed.”

A separate bill in the state Legislature could make it easier to pass a regional housing tax.

Assembly Constitutional Amendment 1 would lower the threshold needed to pass a sales tax or parcel tax from two-thirds to 55 percent, if the funds are used for infrastructure or affordable housing.

Are You an Employee or a Contractor? Carpenters, Strippers and Dog Walkers Now Face That Question.

Article written by Margot Roosevelt, Los Angeles Times

When Kristyn Hansen first took a job at Stews Barber Shop, she cut hair nine hours a day, three days a week. She earned no overtime pay, had no mandated breaks, and her Ladera Ranch bosses didn’t cover Social Security taxes, unemployment or disability insurance.

That’s because Hansen, 32, was classified as an independent contractor. “I loved it,” she recalls. The schedule allowed her to take five classes at a local college. The pay — a 60% share of an $18 haircut — made for “a comfortable living” serving about 30 clients in a day. Health insurance? That was covered by her husband’s employer.

But in October, the shop switched its seven barbers to employee status. To offset the expense of payroll taxes, sick leave, vacation and other benefits extended to the barbers, pay dropped to $15 an hour, with just a 15% share of the haircut price.

Now Hansen works four nine-hour days, taking home about $300 less weekly than when she worked just three days. “For some people, there are advantages to being an employee,” she said. “But not for me. I’m stressed for sure.”

A sweeping California Supreme Court decision last April is upending large and small workplaces across California, making it harder to classify workers as independent contractors. A broad swath of California industries are affected — not just app-based companies such as Uber and Lyft.

Independent contractors are found among construction workers, truckers and warehouse workers, music teachers, software coders and sales associates, farm laborers, janitors, dog walkers, hairdressers, home-care workers, security guards, doctors, insurance agents, journalists and even strippers.

Each sector may have workers who want to remain contractors, collecting untaxed wages upfront without deductions for benefits, and having control over their hours. And it may include others who prefer to be employees, with unemployment insurance, greater job stability and the right to join unions.

But the court set a strict new test: It assumes anyone is an employee if his or her job is central to a company’s core business or if the bosses direct the way the work is done. The verdict came in a lawsuit by drivers for Dynamex Operations West, a national package delivery company that reclassified its employees as contractors, forcing them to use their own vehicles and pay gas and other expenses.

A stricter standard, the court wrote, should prevent businesses from evading “fundamental responsibilities” and engaging in a “‘race to the bottom’ …result[ing] in substandard wages and unhealthy conditions for workers.”

In the California Legislature, the issue is shaping up as one of the most divisive of the year.

The California Labor Federation and worker advocates are seeking to write the court’s decision into permanent law, arguing that workers are often exploited when classified as contractors.

The California Chamber of Commerce, business groups and Silicon Valley giants, seeking flexibility in how they hire, want Dynamex to be suspended, they wrote the Legislature, “before work opportunities are destroyed, and before the trial lawyers start crushing businesses with an onslaught of litigation.”

Among businesses, “there’s a lot of fear,” said Assemblywoman Lorena Gonzalez (D-San Diego), who is authoring Assembly Bill 5 to codify the court’s new standard. “Everybody is lobbying for an exemption.”

Gov. Gavin Newsom, who has strong ties to both labor and the technology industry, suggests a need for compromise. “Workers are too often displaced, devalued and disconnected from the social safety net,” he said in his State of the State address this month. “It’s time to develop a new modern compact for California’s changing workforce. This is much bigger than Dynamex.”

The court’s new test, modeled on a Massachusetts law, strikes at the heart of a fundamental transformation in the U.S. labor force over the last half-century. Many companies have shifted large swaths of their workforces to independent contractor status or to staffing agencies,which offer no job security.

The trend cuts labor costs, thus boosting profits. This “fissured workplace,” as experts call it, has driven down union membership — by law, independent contractors cannot bargain collectively — and contributed to a loss of middle-wage jobs and wider inequality between workers and bosses.

By 2016, full-time independent contractors constituted 8.5% of California’s workforce, according to estimates in UC Berkeley Labor Center’s in-depth survey of available data. A somewhat higher percentage uses independent contracting for supplemental income, the study suggested.

A ‘gig economy’ built on contractors

Companies built around smartphone apps have embraced the independent contractor model, fueling a multibillion-dollar “gig economy.”

But Uber, Lyft, Amazon, Doordash, Grubhub and others are grappling with lawsuits by thousands of workers who say they are misclassified as independent contractors — angry to be exempted from laws governing wages and hours, discrimination, sexual harassment, disability pay and other labor protections.

Wag Labs, a Los Angeles company that offers dog walking through a mobile app, agreed to pay $1.05 million last November to settle a class-action suit on behalf of 38,000 independent contractors who said they were misclassified and forced to work off the clock.
We are disposable people.

Last month, more than 60 Uber and Lyft drivers marched in front of Newsom’s Los Angeles office hoisting hand-lettered signs decrying “Big Tech” and “corporate greed.” The protesters, members of Rideshare Drivers United-LA, a group of 2,500 local drivers, complained about slashed pay, arbitrary terminations known as “deactivations,” and a lack of input on working conditions.

“We are disposable people,” said Francine Ayala, a 40-year-old driver carrying a sign reading, “We want rights and protections.” A single mother, she said she can’t make ends meet after car payments, gas and insurance — business expenses that she wouldn’t have to pay if she were an employee. “If they’re not going to pay us well, they should give us benefits and protection.”

Uber spokesman Davis White declined to comment on lawsuits by drivers. In the past, the company has asserted that it is not in the transportation business — a definition that could make it vulnerable to the Dynamex test — but is merely a technology firm that connects riders to drivers. Other app-based businesses offer similar rationales.

Despite the Dynamex decision, “we believe drivers are independent contractors,” White wrote in an email. “We will continue to support efforts to modernize labor laws in ways that preserve the flexibility drivers tell us they value while improving the quality and security of independent work.”

Decades of conflict

But disputes over employee classification are not new. The high court’s strict test replaces a looser standard that had been used to challenge companies’ independent contractor status since 1989.

Trucking companies, for example, have faced lawsuits for years for relying on independent contractors. Both the California Trucking Assn. and the Western States Trucking Assn. have filed suits to overturn Dynamex. Like the Dynamex drivers found to be illegally classified, truckers often must pay for their own vehicles, gas and expenses.

Mark Hylkema, left, and James Stewart, barbers and co-owners of Stews Barber Shop in Ladera Ranch, had to give employee status to barbers working as contractors after the California Supreme Court’s Dynamex decision. (Irfan Khan / Los Angeles Times)

In Southern California, drivers at the ports of Los Angeles and Long Beach have filed multiple class-action suits. And since 2011, the California labor commissioner has ordered port companies to pay more than $50 million in back wages and damages to drivers misclassified as independent contractors.

A lobbying onslaught

As the Legislature gears up for a fight, companies are enlisting workers to oppose codifying Dynamex. Already, businesses have unleashed more than 6,000 emails and held dozens of meetings with elected officials and their staffs, although the precise language of the bill is not expected to be unveiled until next month.

A chamber-sponsored website, the “I’m Independent Coalition,” offers contractors a form letter urging elected officials to “help protect my freedom.” DoorDash, the food delivery giant, emailed all its “dashers” to write legislators to “suspend the court decision and embrace the modern workforce.”

But Gonzalez, who is writing the Dynamex bill, counters, “If employers don’t pay their fair share, the cost falls on taxpayers. People without unemployment insurance often rely on food stamps or [welfare]. People without health insurance go to emergency rooms.”

Under the 2010 healthcare law, often called Obamacare, companies with more than 50 full-time employees must provide health benefits or pay a penalty. Small businesses are exempt, though some do offer health insurance; Stews Barber Shop now has an “opt-in” plan.

Deja Vu Services, a national strip club chain, has hired Stormy Daniels, the stripper who was paid off by President Trump’s lawyer over an alleged sexual encounter, to promote independent contracting. “Sadly, independent contractor status for exotic dancers in California is now threatened,” Daniels wrote in a Los Angeles Times op-ed piece.

If they are classified as employees, she suggested, “employers might require us to give free nude performances for customers we don’t feel comfortable with.”

Deja Vu is battling class-action suits involving more than 5,800 dancers at 25 California clubs who say they were misclassified as independent contractors.

In November, the company switched its California strippers to employee status, posting a sign in the clubs blaming the lawsuits and “a court order.”

The company is now paying them minimum wage, setting quotas for selling drinks and dances, and slashing their cash commissions to offset the cost of payroll taxes. Some 1,500 strippers have quit to work out of state or “under the table” at noncompliant competitors, according to operations director Ryan Carlson.”

“The clubs are punishing us for exercising our rights,” said a former Deja Vu stripper who goes by the stage name Domino Rey. She and several fellow workers have formed an advocacy group, Soldiers of Pole, to “help us unionize to protect the most vulnerable in the industry and do away with rampant wage theft.”

Contractors in the arts and tech

In the heavily unionized mainstream entertainment industry, Dynamex is unlikely to have much impact. Behind-the-scenes crafts workers, from motion picture animators to theater ushers, are largely classified as employees, although many work intermittent gigs. The International Alliance of Theatrical Stage Employees, Moving Picture Technicians, Artists and Allied Crafts (IATSE) represents 140,000 workers in theater, motion picture and television, trade shows, exhibitions and concerts as well as the equipment and construction shops that support the industry.

But some small arts-related businesses are alarmed. Nathan Pangrazio, founder of the Angeles Academy of Music in Westwood, uses 20 independent contractors to teach piano, voice, violin, guitar and cello. “We are biting the bullet,” he said. “We’re switching them to being employees, but it is keeping me up at night.”

With 200 pupils, the school has a 10% profit margin. “This could take us to almost zero margin,” Pangrazio said. “I don’t want to lower anyone’s pay. But it will force us to hire new people at lower rates.”

“Probably there are enough businesses exploiting people that we need to have a strong law,” he added. “But our teachers like having flexible schedules and working for themselves. And this does hurt people like me who are fair and ethical.”

Nathan Pangrazio at his home in the Fox Hills community. “We’re switching them to being employees, but it is keeping me up at night.” (Kent Nishimura / Los Angeles Times)

In the technology industry, large companies such as Google, Amazon and Facebook hire hundreds of contractors. Their trade group, the Internet Assn., along with TechNet, a network of top executives, and companies such as Postmates, Lyft and Instacart are among the most active opponents of curbing the use of contractors.

But small tech companies, less able to weather the change, are likely to be vocal too.

“Switching my independent contractors to salaried employees would be crippling,” said Dave Krause, founder of Rise-Up Technologies, a Studio City IT services firm with just three employees. Rise-Up helps small and medium-sized businesses with networks and infrastructure, using dozens of outside engineers on projects that may last just a week, or even a single day.

“Everyone is a specialist,” Krause said. “Some in certain software applications; some in distributed databases; others in certain types of hardware; some do security on certain networks. They make between $30 and $150 an hour. I can’t pay taxes and benefits on top of that. Some work for multiple companies. It makes no sense for them to be my employees.”

In Sacramento, negotiations are in high gear. “A lot of businesses are waiting to see what happens legislatively,” Gonzalez said.

The Dynamex decision explicitly allowed for independent contractors, such as electricians or plumbers who run their own businesses, to be hired by unrelated companies. And Gonzalez said other exemptions may make sense, for emergency room doctors, for example.

“There are workers out there who operate as individual businesses — and we are not trying to make them employees,” she said. “But we’ve created an economy where people have to have multiple side hustles. It is not sustainable.”

A strong law is needed “to rid our state of the underground economy, which goes hand in hand with misclassification,” she added.

“Workers need access to a minimum wage and overtime, to sick leave and paid family leave, to unemployment insurance and workers’ comp, to Social Security when they retire.”

Mark Hylkema, co-owner of Stews Barber Shop, is unconvinced. “Small businesses are scared,” he said. “My operating costs rose 30% and I had to raise my prices. We need to hit ‘pause’ in Sacramento.”

Say Cheese....Please?

Get Permission in Writing Before Posting Employees’ Photos Online

Written by Ellen Savage, HR Adviser – CalChamber

Can I choose to post photos of my employees on my company’s website and social media page? Do I need each employee’s consent first? What if an employee refuses?

Posting photos of your employees on the internet can raise serious privacy concerns in California. Some employees may be happy to see their smiling faces online, but others may object for a number of reasons.

An employee who has been the victim of stalking or who has a restraining order may not want others to know where he/she works. Another may be a private person who is not comfortable having his/her photo online. Other employees who don’t like the way they look in photos simply may not wish to have their picture made public.

Regardless of the reason, posting photos online without the employee’s permission may be illegal.

Right of Publicity Laws

Many states, including California, have so-called “right of publicity” laws that limit the way a person’s image can be used for commercial purposes.

California Civil Code Section 3344 makes it illegal to use a photo or video of another person for any sort of marketing purpose in most situations without permission.

Because your company’s website and social media page both likely exist to attract customers and potential employees, use of an employee’s photo for such marketing purposes without his/her permission could be a violation of Civil Code Section 3344. As a result, your company could become liable to your employee for monetary damages, attorney’s fees and costs, as well as punitive damages.

Get Permission in Writing

Before posting a photo of an employee online, get express written permission from that employee. You may choose to get a blanket consent for all future use of the employee’s image at the time of hire, although a better practice is to also obtain permission each time an image is used.

If an employee refuses to consent for whatever reason, do not use their image on your website or social media page.

Personnel Files and Payroll Records, Do I Have to Release Them?

Written by Erika Pickles, Employment Law Counsel / HR Advisor

A former employee has asked for a copy of her personnel file and payroll records. Do I have to provide these to her? And if so, by when?

California laws give your current and former employees the right to request access to their personnel files and their payroll records. There are strict time requirements for responding to these requests, so it’s important to understand what is required of employers.

Personnel Files

Under California Labor Code Section 1198.5, an employee has the right to inspect and receive a copy of the personnel records the employer maintains relating to the employee’s performance or any grievance concerning the employee.
The request must be in writing and employers need to provide employees with a form to use when making such a request.

Employees can request either to inspect their files or receive a copy; if you provide a copy, you can charge the employee for the actual cost of copying the file.

You must either make the personnel file available for inspection or provide the employee with a copy of the file within 30 calendar days of receiving the written request.

Payroll Records

Employees also have the right, under Labor Code Section 226, to inspect or receive a copy of their payroll records. When responding to this type of request, you must provide either copies of the itemized wage statements received by the employee or a computer-generated record that contains all the information on those wage statements.

The law previously stated that employees had the right to inspect or copy their records, but it was amended effective January 1, 2019 to clarify that employees have the right to inspect or receive a copy of their records (meaning employers have to provide the copy and can’t require the employee to make the copy).

As with personnel files, you can charge an employee the actual cost of copying if you provide a copy of the records.

Although there are some similarities between the two types of requests, a request for payroll records differs from one for personnel records in two ways:

  • First, the request for payroll records can be written or oral
  • Second, you have only 21 calendar days from the date of the request to provide the records, so the window to comply is shorter than for a request for personnel records.

Timing Is Crucial

If you receive a request for personnel or payroll records, make sure you comply within the required time frame—30 days for personnel files and 21 days for payroll records. If you fail to meet those deadlines, you can face a penalty of $750 for each violation.

Gilroy Chamber Partners with CalChamber to provide Legally Required Training

Written by Mark Turner, Gilroy Chamber of Commerce President

Effective January 1, 2019, a new California law requires all California employers with 5 or more employees to provide sexual harassment prevention training. The law requires supervisors to receive two hours of sexual harassment prevention and abusive conduct training while non-supervisory employees to receive at least one hour of training. The law also requires the training to occur in the 2019 calendar year, before January 1, 2020. The minimal count of “5” employees covers seasonal and temporary hires, including independent contractors.

It is important to note, the California Department of Fair Employment and House takes the position that employees, including supervisors, who were trained in 2018 will need to be retrained again in 2019.

The Gilroy Chamber of Commerce has partnered with CalChamber to provide online sexual harassment prevention training courses.

Receive a discount through the Gilroy Chamber of Commerce!  Click here to get 20% off harassment prevention training with code LCH8 at CalChamber.com!

Effective Online Training

  • Relevant content on current workplace issues—in office, medical, restaurant and warehouse scenarios
  • Engaging videos depicting different harassment and discrimination situations
  • Interactive learning through scenarios, quizzes and more
  • “Ask the Expert” feature to email questions directly to CalChamber’s training experts

 

Ease of Use/Flexibility

  • Automatic course notification and reminder emails
  • Option to take self-paced course in English or Spanish
  • For use on desktops, tablets and most smartphones
  • Countdown timer to track 2-hour requirement
  • On/off audio button to listen to or just read each lesson
  • Convenient text option for videos
  • Tracked learner progress (start/stop at any time)
  • “Help” button to send technical-related questions to support team
  • Full year from date of purchase to complete the course

For Administrators (Learning Management System)

Easy Startup and Management

  • Two-step learner enrollment
  • Option to add learners and assign training simultaneously (spreadsheet upload)
  • Immediate access to on-demand training
  • One-click status report on course completion
  • Dedicated team of customer support specialists available by phone

Compliance Obligations

  • Meets California’s two-hour requirement for supervisor training
  • Complies with record keeping requirement to maintain training documentation
  • Includes sample required policy for fulfilling obligation to distribute a written policy to employees on preventing harassment, discrimination and retaliation

Helpful Support

  • Video tutorials (on Learning Management System)
  • Tips, tricks and FAQs on administrative functions (Admin Corner on Learning Management System)
  • Support team via live chat, email or phone (weekdays)

Get 20% off harassment prevention training with code LCH8 at CalChamber.com!

What’s New with Business

Eric Howard, Business Relationship Manager, Gilroy Chamber of Commerce

Executive Plan Design is currently looking for tenants to share their available office space. The 2,200 square foot suite currently has 2 offices available and is ideal for professional services. The office is located in the Dry Creek Center. Common area of the suite includes a private conference room, kitchen, bathroom and receptionist area. They are asking $550 per month plus shared utilities. For more information and a tour, please contact Brian Harrigan at 408-334-3951.

Al and Vilma Pinheiro have owned and operated Caravelle World Travel for 30 years. They have taken many groups all over the world and 2019 is no exception. They have planned three trips. They are planning a cruise on May 25 sailing roundtrip from San Francisco to Alaska. They are accepting reservations until March 20. The Azores & Portugal are one of the Top 10 Destinations to visit; on June 26 they have their annual tour to the Azores Islands, Madeira Island and Mainland Portugal. Al has been hosting this tour for over 25 years and knows the country well. If a River cruise is what you are looking for, they have a group space available for April 7, 2020. This is a 15-day Tour of France. Give them a call at 408-842-0200 for your travel needs.

Luxe Beauty Bar and Windermere Valley Properties and Farmers Insurance will be hosting a Mimosa & Bloody Mary Bar, April 6th, 2019 in honor of the Poppy Jasper Film Festival. A $25 donation at the door will go towards supporting the festival. Doors open at 10:00 a.m., at 7433 Monterey Street, Ste. 102. Live musical guest, Angelique Lucero will be there along with a DJ spinning in the background. Limited seating is available. There will be a VIP area hosting Film Directors and Producers in the film industry. Come out and support this great event!

The Guinness Book of World Records recently confirmed that the World Record for the most people inside a spinning loop was set by Will Roberts at the California Rodeo Salinas on July 19, 2018. A western rope artist, actor and entertainer, Will Roberts successfully fit 13 people in his spinning lasso. The record was set at the Salinas Sports Complex before the first performance of the California Rodeo Salinas in 2018. Several attempts were made before Roberts successfully held the loop; he is proud of his achievement and said, “What an honor to break this world record at my favorite rodeo in the United States of America.” Roberts went on to say, “The California Rodeo Salinas defines rodeo and the American cowboy! I couldn’t be more thrilled that this happened in Salinas.” Roberts will entertain fans on the grounds during the 109th California Rodeo Salinas, July 18-21 in Salinas. Get event information at www.CARODEO.com.

Eva Emperador recently joined the Gilroy Chamber of Commerce. As a World Financial Group Inc. financial professional, she’s focused on you, your needs, goals, and objectives. She strives to help individuals, families, and businesses create a sound strategy by providing guidance and showing you ways to build your savings (college or retirement), and protect what’s important to you, as you prepare for your financial future. Other services she offers are estate preservation, long term care insurance, financial strategies for small business owners and their employees. Eva’s family relocated to Gilroy in 2008 from Michigan. Eva and her husband are very involved at St. Mary Church in the Sunday music choir, a lector and as an usher during the 7:00 a.m. mass. Eva can be contacted by calling 408-823-5053 or visit her website at WFGConnects.com/evaemperador.

13 Ways We Justify, Rationalize, or Ignore Negative Feedback

Article written by Peter Bregman, CEO of Bregman Partners

Everybody loves feedback . . . as long as it’s positive.

But most of us dislike negative feedback so much that we’ve even changed the name — it’s not negative, it’s constructive.

Still, it’s an irreplaceably valuable gift.

We need to know when we are doing things that don’t land the way we planned. When our impact veers from our intention. And the best — often times the only — way to discover that gap is through feedback.

That said, chances are you fight against it.

It doesn’t feel good to be told you missed the mark. And, since feedback often uncovers our blind spots, it’s especially jarring because, in many cases, we thought we were doing a good job. So we don’t immediately or intuitively agree with the validity of it (we tend not to believe things we can’t see ourselves).

This is especially true for leaders who, because of rank and power, don’t often get told the whole truth.

So, it’s not unusual for leaders to get defensive when we hear criticism about our leadership. It doesn’t fit with the story we tell ourselves.

In order to understand this issue more intimately, I asked the person I work most closely with to give me negative feedback, to expose one of my blind spots.

I took a breath and readied myself. I wanted to go slowly and notice everything that happened in my mind and my body.

“You work too hard,” She said. As criticism goes, this was a softball.

Still, here’s what happened:

That’s a compliment, I thought, not a criticism. She was trying to tell me that I am acting in ways that are unsustainable for me and for the organization, but my protective response was pride.

That thought was quickly followed by another: She doesn’t work hard enough! I de-validated her feedback by de-validating her. It’s not that she’s insightful, my ego decided, it’s that her bar is not high enough.

And then another thought: I have to work so hard because the business depends on me. I made excuses to justify why I act the way I do. In other words, sure I work too hard but it’s not my fault.

Meanwhile I felt a squirrelly feeling in my abdomen and could feel the vulnerability of not being perfect. It was subtle but definitely a felt experience. A physical reaction, a feeling that something wasn’t right.

As an executive coach who helps successful people become great leaders and create more effective teams, I’m often in the position to give people feedback that’s hard to hear.
As I thought about my own reaction, as well as the reactions I often hear from clients, I began to list the common things we say (or think) when hearing negative feedback to defend against new information that threatens the way we see ourselves:

  • Play Victim: “Yes, that’s true, but it’s not my fault.”
  • Take Pride: “Yes, that’s true, but it’s a good thing.”
  • Minimize: “It’s really not such a big deal.”
  • Deny: “I don’t do that!”
  • Avoid: “I don’t need this job!”
  • Blame: “The problem is the people around me. I hire badly.”
  • Counter: “There are lots of examples of me acting differently.”
  • Attack: “I may have done this (awful thing), but you did this (other awful thing).”
  • Negate: “You don’t really know anything about X.”
  • Deflect: “That’s not the real issue.”
  • Invalidate: “I’ve asked others and nobody agrees with the feedback.”
  • Joke: “I never knew I was such a jerk.”
  • Exaggerate: “This is terrible, I’m really awful.”

If you ever notice yourself saying, or thinking, any of the above, it’s a clear sign that your ego is getting in the way of an important learning.

A lot has been written about how to receive feedback well, some of it quite nuanced. But once our ego is involved, and we feel the emotional charge, it’s hard to access nuance. What we need, is a simple, reliable, default response:

“I really appreciate you taking the time and the effort to tell me. Thank you.”

Isn’t that the way you would want someone to respond after you gave them a gift? Accept the gift (in this case, that means listen), and then say “thank you.” That’s it.

This response communicates to people that it’s safe to offer you feedback and they will be far more likely to speak directly to you, instead of behind your back.

There’s also an almost magical added benefit to this simple, undefended response: It dramatically increases your ability to take in the feedback. When you stop defending against it externally, you actually stop defending against it internally too.

After my colleague told me, “You work too hard,” and I quietly observed all my own defensive reactions, I followed my own advice. “I really appreciate you taking the time and the effort to tell me,” I said. “Thank you.”

The result? She thanked me for receiving it so well and I’ve actually begun to put less pressure on myself and others.

Maybe that’s why they call it constructive feedback after all.

Peter Bregman is the CEO of Bregman Partners, a company that helps successful people become better leaders, create more effective teams, and inspire their organizations to produce great results. Best-selling author of 18 Minutes, his most recent book is Leading with Emotional Courage. He is also the host of the Bregman Leadership Podcast.

Silicon Valley’s Economy is Booming, But So is the Traffic

Written by Zoe Schiffer, KQED News

Silicon Valley is booming, and with it comes new real estate development, higher salaries and more traffic, according to a new survey released on February 15.

According to this year’s economic survey from Joint Venture Silicon Valley, commute times have increased by more than 20 percent over the past 10 years, adding an additional 43 hours of driving time per commuter annually. The report was released at the nonprofit’s annual State of the Valley event.

“It’s rolling now to a crescendo,” said Russell Hancock, CEO and President of Joint Venture. “Cities are also realizing that when they have employers in their boundaries it creates externalities, and one of those is traffic jams.”

The report also finds the cost of housing plays into the traffic problem. Over the past two years, the median home price has increased by $300,000, bringing it to $1.2 million last year. Compare that to $221,000 — the median price in the U.S. overall.

The number of homes on the market has also decreased significantly. In 2018, there were half as many home sales as there were in 2004.

“The inventory is at historic lows, people are actually holding on to their houses” instead of downsizing in retirement, Hancock said.

This adds up to more local employees — 95,000 in 2017 — who are forced to live so far away from their jobs that they end up commuting more than three hours a day. Caltrain ridership has reached an all-time high, but not everybody lives along the rail lines.

The cost of transportation needs in Silicon Valley rose by 4 percent over the past four years, after adjusting for inflation. This compares to a decrease in the cost of transportation needs of 12 percent statewide over the same period, according to the index.

But if housing costs and traffic are driving tens of thousands of people to leave the region, the migration out is almost exactly matched by the migration coming in. Silicon Valley lost roughly 22,300 people last year but gained roughly 20,500.

In Los Angeles, where congestion is old news, Mayor Eric Garcetti is overseeing a major transit plan to bring 100 miles of new rail line to the city.

“We’re really looking at what we’re doing with a once, not just in a generation, but once in a century investment in transportation,” Garcetti said during his keynote at the State of the Valley event.

But the report isn’t all doom and gloom. While Silicon Valley faces major challenges, there are still enormous opportunities.

The median household income here is higher than it has ever been. In 2017, it grew by 5 percent, bringing it to $118,400 annually. Unemployment is also fairly low, at 2.3 percent compared to 3.9 percent in California overall.

“Our success is greater than other parts of the country and our failures are greater than other parts of the country,” Garcetti said of Silicon Valley.

Unemployment for black or African-American residents has also decreased. It’s currently at 5 percent, which, though higher than the overall rate, is 7 percent lower than it was in 2011.

Felony Murder Law Repealed? Maybe Not

Written by Dan Walters, Opinion Writer for Calmatters

Two young men drive up to a small corner grocery store in an inner city neighborhood and the driver remains at the wheel while his masked partner runs into the store, gun in hand, to commit a robbery.

The armed gunman shoots and kills the clerk before grabbing cash out of the register, then jumps back into the car and the two make their getaway.

Days later, thanks to an informant, police locate the two robbers, but each points to the other as the gunman and there’s no evidence to prove it either way. What happens?

For decades, both could be prosecuted under the “felony murder” law. If someone participated in a felony that resulted in a death, he or she was as guilty of homicide as the person who actually stabbed, shot, strangled or beat the victim.

California and most other states embraced the principle of equal guilt, lifted from English common law.

But no more – perhaps.

Last year, as one of a long string of recent “criminal justice reform” decrees, the Legislature passed and Gov. Jerry Brown signed Senate Bill 1437, which virtually eliminates California’s felony murder law – virtually because it could still be used on someone who displayed “reckless indifference to human life,” or if the homicide victim is a law enforcement officer.

The latter exception was inserted into the bill as a sop to law enforcement officials and prosecutors who strenuously opposed the measure.

The rationale for repealing felony murder, offered by the bill’s author, Sen. Nancy Skinner, a Berkeley Democrat, and criminal justice reform groups is that it unfairly penalized criminal accomplices, many of them women, who didn’t intend that anyone die.

Among other things, it allows several hundred prison inmates convicted under the law to petition for reduction of sentences.

Prosecutors and police not only opposed the measure on its underlying rationale, saying it would go too easy on dangerous criminals, but also because the threat of felony murder prosecution has been a valuable tool to persuade those involved in fatal felonies to turn on their accomplices.

In the hypothetical case cited above, the holdup’s getaway driver, facing a felony murder charge, might be willing to provide police with evidence, such as the gun, to convict the shooter in return for leniency.

While the Legislature and Brown have virtually repealed felony murder, they don’t get the last word.
Several courts have upheld the law’s validity, but this month, an Orange County Superior Court judge, Gregg Prickett, allowed a felony murder case against an accomplice in a 2016 homicide to proceed, declaring that SB 1437 is unconstitutional.

Prickett, who was an Orange County prosecutor before being appointed to the bench in 1995, ruled that California voters locked felony murder into law while passing ballot measures in 1978 and 1990, so it would require another action by voters to repeal it.

“The Legislature cannot amend or redefine murder in order to avoid penalties that (voters) set for the crime,” Prickett ruled.

The declaration drew scorn from Skinner and other supporters of the new law.

“As the author of SB 1437, which reformed California’s unfair felony murder rule, I look forward to the state appellate court overturning this wrong-headed decision by an Orange County judge. Other courts around the state have already held that this much-needed reform is constitutional. I’m confident that SB 1437 will ultimately be upheld,” Skinner said in a statement.

The issue is obviously headed to the state Supreme Court.

Soda, Water, Guns and Tires Could All Be Taxed

Written by, Andrew Sheeler – McClatchy Newspapers

It’s a standard California Republican talking point that Democrats want to raise taxes. And it’s true that Golden State Democrats have introduced, or plan to introduce, legislation that would raise or create several new taxes.

If there’s one thing the proposals have in common, it’s that they all reflect some facet of the California Democratic Party’s larger environmental and social justice bent.

From a new excise tax on firearm sales to one on sugary beverages, from an oil and gas “severance tax” to an increase in the California tire fee, here’s a rundown on tax-and-fee-increasing bills currently under consideration in Sacramento.

FIREARMS EXCISE TAX

“Although California has the toughest gun laws in the nation, more effort is necessary to curtail gun violence,” Assembly Bill 18, sponsored by Assemblyman Marc Levine, D-Greenbrae, reads in part.

AB 18 “would express the intent of the Legislature” to impose an excise tax on the sale of handguns and semiautomatic rifles, with that revenue going to the California Violence Intervention and Prevention Grant Program.

According to the bill language, between 2014 and 2016, the California Department of Corrections and Rehabilitation found that gun homicides in the state increased by 18 percent.
While AB 18 would express the Legislature’s intent, the actual tax would come in the form of another bill.

SODA TAX

For the third time in as many legislative sessions, Assemblyman Richard Bloom, D-Santa Monica, announced that he plans to introduce a bill to create a “beverage fee.”
“We have ignored this crisis for too long,” Bloom said in a press conference announcing his plan. “We are standing on the edge of a cliff, and addressing this health crisis requires a multi-pronged approach…”

Bloom has not yet set the proposed fee, but in past years he has argued for a 2-cents-per-fluid-ounce tax.

The soda industry has fought the proposed soda tax before, and likely will again. They have allies in Republicans like Assemblyman James Gallagher of Yuba City, who said of the idea, “Californians don’t want to be treated like children.”

TIRE CHANGE FEE

Getting a tire changed could soon get a little pricier.

Assembly Bill 755, sponsored by Assemblyman Chris Holden, D-Pasadena, would raise the tire change fee from $1.75 per tire to $3.25 per tire.

The additional revenue would go into the state’s Stormwater Permit Compliance Fund, created by AB 755, to pay for “competitive grants for projects and programs for municipal storm sewer system permit compliance requirements that would prevent or remediate zinc pollutants caused by tires in the state.”

Tires are made up of 1 to 2 percent zinc, and that zinc can break off into “rubber crumbs” that then get into the ground, the water supply and the air. While people and animals needs a small amount of zinc to survive, large amounts can be toxic and contribute to kidney and pancreas damage, according to the Centers for Disease Control and Prevention.

WATER TAX

Gov. Gavin Newsom has made clean water a priority of his new administration, and in his first budget he called for a drinking water fee that would pay to provide clean water to nearly 1 million Californians.

Senate Bill 200, sponsored by Bill Monning, D-Carmel, follows Newsom’s lead by creating a “Safe and Affordable Drinking Water Fund.”

Monning’s bill states that nearly a million people, “particularly those living in small disadvantaged communities, may be exposed to unsafe drinking water in their homes and schools, which impacts human health, household costs, and community economic development.”

While SB 200 doesn’t lay out the specifics of how that fund will receive money, he previously proposed a 95-cent monthly tax on residential water customers, as well as fees for dairy and feedlot owners and fertilizer production.

OIL AND GAS SEVERANCE TAX

A California lawmaker has called on oil and gas companies to pay “for the privilege of severing oil or gas from the earth or water.

Sen. Bob Wieckowski, D-Fremont, is the author of Senate Bill 246, which would impose a tax of 10 percent of the average price per barrel of oil or unit of gas.

That money would go directly into the state’s general fund.

Wieckowski’s bill is opposed by Robert Gutierrez, president and CEO of the California Taxpayers Association, who wrote in an op-ed for the Bakersfield Californian that the tax would not only harm oil and gas industry workers, but also be “an especially big dent in the wallets of those who drive for a living or are forced to commute long distances to and from jobs.”

February 2019

Judge Says YES to Hospitals, NO to Attorney General

Written by Barry Holtzclaw, Gilroy Dispatch

A U.S. District Court judge in Los Angeles today rejected a bid by California Attorney General Xavier Becerra to block the purchase of two failing Verity Health System hospitals by Santa Clara County.

The ruling clears the way for the county to close its $235 million purchase of Saint Louise Regional Hospital in Gilroy and O’Connor Hospital in San Jose, plus the DePaul Urgent Care Center in Gilroy. County officials said they expect to close the deal Feb. 28, when a court-approved purchase agreement expires, and take ownership on March 1.

“We are pleased that the district court denied the stay, which will allow the county to complete its purchase of the hospitals next week,” County Counsel James Williams said in a statement today. “We will now be able to keep these hospitals open to ensure access to healthcare for the residents of Santa Clara County.”

Becerra had appealed a Bankruptcy Court’s December approval of the sale to U.S. District Court, and sought a stay of the sale, pending resolution of the appeal—which would have voided the county’s purchase agreement and forced the two hospitals to close. There were no other purchase offers.

“The public interest factors weigh against the stay,” U.S. District Court Judge R. Gary Klausner wrote in his six-page opinion. “A stay may result in the cancellation of the sale, which could in turn lead to a closure of both hospitals.

“The bankruptcy [court] did not abuse its discretion when it found that ‘far from protecting the health and welfare, a stay would set in motion a series of events that, in all probability, would reduce the availability of healthcare services to the public,” the judge wrote in his ruling.
“These two hospitals are essential to the continued health and well-being of folks in our region,” said Santa Clara County Supervisor Joe Simitian, president of the county Board of Supervisors. “Continued litigation by the attorney general is a distraction from the important work we have to do. It’s time to stop arguing about who’s right, and start focusing on what’s right. And that’s taking care of the folks here in the county who need our help.”

Becerra had argued it was necessary to block the sale—even it if meant closing the hospitals—to ensure that his office could enforce guarantees of healthcare services.

“Two federal judges have now rejected the attorney general’s arguments against the county as meritless attempts to exert authority he does not have over local governments,” said County Executive Jeffrey V. Smith. “The county will ensure that O’Connor and Saint Louise hospitals continue serving our communities with the enhanced services we will offer through the hospitals as part of the county’s integrated Health System.”

Klausner affirmed in today’s ruling an earlier decision in Bankruptcy Court that the sale of the hospitals “is not reviewable by the attorney general.”

“Losing Saint Louise Hospital simply was not an option for me and for the 100,000 Gilroy and Morgan Hill residents who would have lost their local hospital,” said Supervisor Mike Wasserman, whose district includes Gilroy and Morgan Hill. “I am grateful to the many people who joined our fight!”

“The ruling by the U.S. District Court Judge means we can keep San Jose’s O’Connor Hospital, Gilroy’s St. Louise Regional Hospital and the De Paul Health Center in Morgan Hill open,” said Supervisor Cindy Chavez. “This is all about the thousands of patients who need our services, 451 hospital beds and 1,700 highly trained and dedicated nurses, doctors and other health care industry workers who provide those services.”

“We are very pleased that the District Court denied the stay, allowing the County’s purchase of the hospitals to go forward,” said County Counsel James R. Williams. “The county has and will continue to serve as a model for local governments nationwide in protecting the health and wellbeing of our residents.”

Smith said the county anticipates closing the transaction on Feb. 28 and taking possession of the hospitals on March 1. He said the transition process will be “seamless” as far as patients are concerned, wth most of the 1,700 doctors and staff at the two hospitals staying at their current jobs.

Supervisor Dave Cortese said, “We hope that this ruling will put an end to his interference in the county’s pursuit of providing health care and emergency services to the residents of Santa Clara County.”

There is one more hurdle for the county to cross, however, Smith cautioned. The California Nurses association, which represents nurses at O’Connor and Saint Louise, has asked the state Public Employment Relations Board to intervene on the nurses’ behalf.
The nurses union is a rival of the Registered Nurses Professional Association, which represents nurses at the flagship of the expanded county healthcare system, Santa Clara Valley Medical Center. The new county-employee nurses will be covered by the RNPA contract beginning March 1.

CNA members told the county Board of Supervisors last week they would strike at O’Connor and Saint Louise if the county didn’t recognize their union and begin negotiations on a new nurses contract for the two hospitals. The CNA has asked PERB to see an injunction in state court next week to block the sale until the issue of union representation is resolved.

Judge Rules in Favor of County, What’s Next for St. Louise Hospital?

Mark Turner, President/CEO, Gilroy Chamber of Commerce

Now that the Judge has ruled in favor of Santa Clara County, the Sale of St. Louise Regional Hospital will move forward. What does this mean for the hospital, the employees and the community?

The Gilroy Chamber of Commerce is hosting a free Town Hall Meeting with John Hennelly, CEO of St. Louise Hospital at Old City Hall Restaurant beginning at 6:30 pm, Tuesday evening, February 26.

John will provide information pertaining to the transition from Verity to the County. What will the transition look like? Will services change? Can I still go to St. Louise for care. What questions should I ask? John will answer these questions and more. If you’re interested in learning more or if you have questions of your own, join us at 6:30 on Tuesday evening, February 26.

Paws-in-the-Park – Pet Festival

Mark Turner, President/CEO, Gilroy Chamber of Commerce

May is National Pet Month and Saturday, May 18 is South County’s Inaugural Pet Festival called, “Paws-in-the-Park.” Dogs and their humans of all kinds are invited to partake in the festivities which will take place on the soccer field at Gavilan College from 10:00 a.m. to 3:00 p.m. Dogs and humans can attend the Paws-in-the-Park, free of charge.

There will be all kinds of activities, demonstrations, presentations and contests. Activities will include agility course demonstrations, obedience, search and rescue and police K-9’s to name a few. Be sure to put on your best face and enter the Pet-Owner Look Alike Contest, dress to the (K) nines and enter the Doggie Dress-Up contest or show us the Best Tail Wag and win a prize. You can even take a picture with your pooch in a Barcalounger.

Save the date and then come out and spend a few hours for some of the best doggone fun you’ll have with your four-footed furry friends and neighbors. Lots of vendors will be present including food, drink, pet insurance and other pet related vendors, veterinary services, and more.

They’re baacck…

The article written below by Laura E. Curtis, a Policy Adviser at CalChamber, highlights the ongoing effort by the State Legislature to create onerous and redundant legislation which negatively impacts small businesses in California. The Gilroy Chamber of Commerce partners with CalChamber to track legislation and make business owners aware of such bills.

The reintroduction of several bills from last year sure makes it feel like “Groundhog Day” at the State Capitol. Even though there still is one week to go before the February 22 deadline for introducing new bills, the expansive list of reintroduced labor and employment bills includes:

AB 9 (Reyes; D-San Bernardino – 2019) / AB 1870 (Reyes – 2018): AB 9 is nearly verbatim of AB 1870, which was opposed unless amended by the California Chamber of Commerce last year. These bills extend the statute of limitations from one year to three years for all employment-related discrimination, harassment and retaliation claims filed with the Department of Fair Employment and Housing (DFEH).

Notably, Governor Edmund G. Brown Jr. vetoed AB 1870 because “the current filing deadline—which has been in place since 1963—not only encourages prompt resolution while memories and evidence are fresh, but also ensures that unwelcome behavior is promptly reported and halted.”

AB 35 (Kalra; D-San Jose – 2019) / AB 2963 (Kalra – 2018): These bills require the Department of Public Health to report to Cal/OSHA elevated blood lead levels of workers.
CalChamber-opposed AB 2963 was vetoed by Governor Brown last year because “[T]he Department of Public Health already works collaboratively with employers to reduce worker exposure to lead and refers employers to the Division for enforcement, if needed, on a case-by-case basis. This bill would erode that collaborative approach, and require the Division to take immediate enforcement action upon referral.”

AB 51 (Gonzalez; D-San Diego – 2019) / AB 3080 (Gonzalez – 2018): AB 51 is similar to AB 3080 in that it would ban settlement agreements for labor and employment claims, as well as arbitration agreements made as a condition of employment, which would significantly expand employment litigation and increase costs for employers and employees.

AB 3080, a 2018 CalChamber job killer, was vetoed by Governor Brown. In his veto message, he stated: “Since this bill plainly violates federal law, I cannot sign this measure.”

AB 170 (Gonzalez; D-San Diego – 2019) and AB 171 (Gonzalez – 2019) / AB 3081 (Gonzalez – 2018): AB 3081 from last year was considered the author’s omnibus sexual harassment bill. This year, the author took two of the three major provisions of AB 3081 and placed them into AB 170 and AB 171.

CalChamber-opposed AB 3081 was vetoed by Governor Brown on the basis that “This bill creates a new, ill-defined standard of joint liability between labor contractors and client employers, prohibits both entities from retaliating against an employee who has filed a harassment claim, and establishes a 30-day notice requirement before certain workers can file a civil action against a client employer. Most of the provisions in this bill are contained in current law and are therefore unnecessary. To the extent there are new provisions, they are confusing.”
The justifications provided by Governor Brown for his veto of AB 3081 are applicable to AB 170 and AB 171 since these provisions remain in the reintroduced bills.

AB 403 (Kalra; D-San Jose – 2019) / AB 2946 (Kalra – 2018): AB 403 is almost identical to AB 2946, opposed by the CalChamber last year. These bills undermine the essence of the Division of Labor Standards Enforcement (DLSE) complaint process by requiring a one-sided attorney’s fee provision that will incentivize further litigation.
AB 2946 failed to pass the Assembly in 2018 with only 19 aye votes.

SB 142 (Wiener; D-San Francisco – 2019) / SB 937 (Weiner – 2018): SB 937 was reintroduced as SB 142 this year. These bills would significantly amend current law regarding lactation accommodations by implementing new building code standards, location standards, employer policy requirements, document retention, and supplementary Labor Code penalties.
Notably, CalChamber-supported AB 1976 (Limón; D-Santa Barbara) was just signed by Governor Brown last September and establishes new mandates regarding lactation accommodations.

And in his veto message for CalChamber-opposed SB 937, Governor Brown stated, “I have signed AB 1976 which furthers the state’s ongoing efforts to support working mothers and their families. Therefore, this bill is not necessary.”

SB 171 (Jackson; D-Santa Barbara – 2019) / SB 1284 (Jackson – 2018): SB 171 is essentially the same as CalChamber-opposed SB 1284, which required California employers to submit pay data to state agencies that could give the false impression of pay disparity where none may exist.

SB 1284 was held on the Suspense File in the Assembly Appropriations Committee.

While the groundhog predicted early spring for us this year, apparently the Legislature didn’t get the memo, because it sure feels like it’s going to be a long winter for businesses in California.

A tax penalty could help shore up Obamacare in California. Gavin Newsom wants to try it.

Article written by, Sophia Bollag, Michael Finch II, and Sammy Caiola, The USC Center for Health Journalism Collaborative

When Kate Green calculated her health care costs last year, it just didn’t add up for her to stay insured.

The 30-year-old worker in a real estate referral company had signed up for the lowest-cost plan possible, but it came with high out-of-pocket costs. Premiums ate up money Green had planned on spending to pay off car and college loans. The final straw: a $1,200 doctor bill for a minor knee injury. Green dropped her coverage in late 2018, and the tax penalty for not having insurance disappeared this year for the first time since the launch of the Affordable Care Act.
So far, she hasn’t regretted the gamble.

“If I have a life-threatening injury and I get taken to the hospital in an ambulance, yes, right now I’d have hundreds of thousands [in] bills,” the Sacramento resident said. “And if I was insured it might be like tens of thousands. It’s bankrupting me effectively either way.”

When the federal Affordable Care Act first took effect in 2014, Americans had to pay a penalty known as the individual mandate if they didn’t have insurance. Congress has since rolled back the penalty, meaning Green won’t be fined for not having coverage.

But that could change if California Gov. Gavin Newsom recreates the individual mandate at the state level as part of his plan to prop up the state’s health insurance exchange and get more people insured.

Newsom and his legislative allies say they want the state-level mandate to work the same way as the federal one. The goal is to encourage enough healthy people to buy coverage to offset costs from those who need expensive care.

Newsom characterized the mandate as necessary to stabilize the health care system under the Affordable Care Act in the face of the federal government’s “vandalism” of the law.
“You need that stability of the mandate because that increases the purchasing pool, which lowers your cost,” Newsom said last month when outlining his budget proposal. “Every single person in California should be celebrating that.”

Assemblyman Rob Bonta, D-Alameda, is carrying a bill that would implement the governor’s vision. “We want as many people participating in the health care market as possible,” Bonta said.

The Newsom administration estimates the penalty would generate about $500 million each year. Newsom wants to earmark that revenue to fund insurance subsidies for what he calls “middle-income” families — individuals earning between $48,560 and $72,840 or a family of four with a household income of less than $150,000.
In a report last week, the nonpartisan Legislative Analyst’s Office said the mandate could be “one of the state’s most effective policy options” to increase the number of insured Californians and lower coverage costs by using the threat of a penalty to increase the pool of healthy people paying into the system.

But the LAO also cautioned that the individual mandate’s goal of getting more people to buy insurance is “at odds with the goal of raising revenue for insurance subsidies.” That’s because as more Californians sign up for insurance, fewer people will pay the penalty, generating less money.

People who fall below a certain income threshold wouldn’t have to pay a penalty under Newsom’s plan. But the mandate would still disproportionately affect people in lower- and middle-income tax brackets, according to an analysis by the USC Center for Health Journalism Collaborative.

Almost 600,000 Californians paid a penalty in 2016, the most recent year for which data is available. Nearly three in four of those Californians earned less than $50,000 in gross income, IRS data shows.

In 2016, the penalty was $695 per adult or 2.5 percent of yearly household income, whichever was higher.

Congressional Republicans and President Donald Trump argued it was unfair to penalize people for choosing not to have insurance when they rolled back the individual mandate in 2017.

The mandate isn’t popular among California Republicans either. State Sen. Andreas Borgeas said it would prop up the existing patchwork system.
“We’re putting gum and MacGyvering Band-Aids on this system,” the Fresno Republican said during an event at the Sacramento Press Club last week. “It needs to be redone and reviewed top to bottom.”

Even for Democrats, who have supermajorities in each chamber of the Legislature, voting for the individual mandate could be a heavy lift. Lawmakers in vulnerable districts are often targeted if they vote for taxes. Last year, Democratic state Sen. Josh Newman of Fullerton was recalled after he voted to increase California gas taxes.

Taxes also typically require a higher threshold for passage in the California Legislature: a two-thirds supermajority instead of the simple majority required for most bills. The Newsom administration says it believes its individual mandate proposal will require only a majority because it would simply reimpose the federal penalty at the state level. Bonta said that when it comes to his bill, that will be up to the Legislature’s lawyers to decide.

If the state doesn’t take action, as many as 450,000 more Californians will be uninsured in 2020 than if the federal government had left the individual mandate in place, according to a recent analysis by researchers at UC Berkeley and UCLA.

While some celebrate plans to shore up the finances of California’s individual health care market with a state penalty for going uninsured, Green, the woman who dropped her insurance, isn’t among them. Even with additional subsidies, the mandate would still hurt people who have trouble affording insurance, she said.
“I think the idea of penalizing people for not being able to afford health insurance is kind of counter-intuitive,” Green said. “You already can’t afford it, and here, let’s charge you more money.”

Opinions expressed by the author of this article are his/her own

 

AI is Within Reach for Small Business Marketing

Article written for Entrepreneur by Kris Barton, Chief Product Officer, Gannet

Limited budgets have traditionally left small businesses at a disadvantage when looking to market themselves. Thanks to affordable artificial intelligence (AI) tools coming to the market — everything from Adobe’s Marketo to Salesforce’s Pardot to our solution, LOCALiQ — that’s all about to change. These tools are opening new doors to advanced targeting and optimization that previously were reserved for larger organizations.

However, for startups and small businesses that also presents a new, rightfully intimidating learning curve. Artificial intelligence belongs in the realm of computer geniuses, right? Wrong. It belongs to you, the marketer. But where do you start and get up to speed?

The stakes.
The competition has never been more fierce for small businesses looking to stay alive. Amazon, for example, is looking to own everything from local grocery delivery to pharmaceuticals and household goods. Small-to-medium sized businesses (SMB), not working with a billion-dollar budget, can very quickly be eaten up and pushed out. The stakes couldn’t be any higher to grow and retain customers — in some cases existing customers represent 40 percent of revenue — and AI is going to help level the marketing playing field.

Trial and error exercises in marketing are costly, and most small businesses can’t afford the risk of tactics that may or may not have the right impact on customers. Through the application of an affordable AI tool, marketers can tackle this uncertainty and benefit from recommendations for search, social and mobile advertising that are already optimized to provide the best results and drive traffic to best performing ad options. No more wasting money to “see if it works.”

Of a similar nature, AI allows for real-time competitive reporting that can help SMBs make recommendations on how to better compete in areas of weakness compared to other companies in the market. And, as any good marketer knows, customer satisfaction is paramount.

In fact, 76 percent of customers now report that it’s easier than ever to take their business elsewhere — switching from brand to brand to find an experience that matches their expectations. With AI, smart client management tools become accessible to the SMB, increasing the usefulness of the data gathered on social, emails and calls by providing deeper insights into what customers and clients want and might need in the future.

How it all works.
Big data and data intelligence have been buzzwords for years. Until recently, it has been difficult for any company that didn’t hire from a very limited pool of data scientists to take that data and actually do something with it.
AI solutions for marketers leverage big data to audit current traffic and ad performance to make real-time recommendations on the most valuable ads and strategies worth investing in.

What might take a marketing team days, weeks or even months to evaluate success and what worked or what didn’t work, AI can handle that same task in a matter of minutes. A smart AI platform will conduct predictive tests — if X amount of budget goes in Y strategy, based on historical success, we’ll make Z amount of money. The machine learning working behind the scenes allows the system to simultaneously take into account each ad served and the resulting conversation (or lack thereof) to influence future decisions about where the ads should be placed, who should get the ads and what forms of advertising are resulting in the most conversation/leads.

The potential ROI.
Implementing AI technology into the marketing process is intimidating, but at some point, it will be an inevitable undertaking. Companies that wait too long to embrace it will find themselves on the wrong side of profitable. The potential ROI from AI is just too great to resist for too long.

Especially as new tools becoming increasingly accessible, small businesses will be seeing some of the largest benefits. SMBs will save money by avoiding the wasted cost of failed marketing efforts like poor performing ads, lazy personalization, misunderstanding audiences and who needs what ad and the like. They will also save time, finally finding an efficient and cost-effective strategy to collect and analyze data from different solos and move quickly to make better decisions.

Related: Shaping The Workforce of the Future: How AI Contributes To The Workplace
Until recently, large corporations have been the only teams in town with enough capital to take advantage of AI-driven marketing tools. However, as the price points have lowered and created a more approachable entry point for the SMBs to get in the game too, it won’t be long until more mom and pop shops and startups are feeling the benefits of this type of technology as well.

Opinions expressed by the author of this article are his/her own

 

 

Gilroy Chamber to Host Town Hall Meeting with St. Louise Hospital CEO

Mark Turner, President/CEO, Gilroy Chamber of Commerce

John Hennelly, CEO of St. Louise Regional Hospital, will be discussing the future of the hospital at a town hall meeting, Tuesday evening, February 26 at 6:30 p.m. at Old City Hall Restaurant.

The County is looking to purchase both St. Louise Regional Hospital in Gilroy and O’connor Hospital in San Jose. With California Attorney General, Xavier Bacerra, attempting to block the sale, what does the future hold for a region like South County with more than 110,000 residents?

U.S. District Court Judge, Dolly Gee is expected to rule on the Attorney General’s request on February 22. That’s when a hearing is scheduled in Los Angeles. At risk is O’connor’s 358 beds and St. Louise’s 93 beds which the County is hoping to encompass into its healthcare system.

Join us at the town hall meeting as John provides an update on the transition of ownership from Verity to Santa Clara County. Some of the questions people are asking are, “After the transition, can I still go to St. Louise for care? Will the services change? Will the staff change? What questions should I ask?” John will answer these questions and more. Plan on attending to learn more about our community hospital.

Gilroy Chamber to Host Mayor’s State of the City Address

Mark Turner, President/CEO, Gilroy Chamber of Commerce

What’s ahead for Gilroy? What’s the economic outlook for our community? What vision does the Mayor and Council have for our City? What challenges do we face and what opportunities exist?

The Gilroy Chamber of Commerce will once again host Mayor Velasco’s State of the City address on Thursday evening, March 7, 2019 from 6:00 – 8:00 p.m. Join us as we hear the Mayor address these questions and more.

The State of the City Address will take place at Old City Hall Restaurant. The cost is $45 and dinner will be served. Contact the Chamber to make reservations or go to gilroy.org.

What’s New with Business

Eric Howard, Business Relationship Manager, Gilroy Chamber of Commerce

What’s New with Business

Let the dice roll! Come join the fun at the Carolyn Schell Annual PEO Bunco Night. Along with Bunco there will be hearty appetizers, dessert, refreshments and a no-host bar. Great raffle and unique silent auction items including a Gourmet Italian Dinner Party for eight and an English Tea Party for six. P.E.O. Chapter CG is a non-profit, philanthropic educational organization. Proceeds benefit women’s college scholarships, grants, awards and loans for women. Enjoy the evening on Friday, March 22, from 6:00 to 9:00 p.m. at Old City Hall Restaurant, 7400 Monterey Road, Gilroy. Tickets available at the Nimble Thimble, 7455 Monterey Road, Gilroy or call Paula 408-739-2665. $30 per person.

California Passport Tours is a boutique concierge-style tour company servicing Gilory and Morgan Hill. They specialize in custom food & wine tasting along with farm and outdoor tours. They provide everything you need from transportation to itinerary planning and dinner reservations as well. They partner with The Valley of Hearts Delights to offer behind-the-scene, guided access to local wineries and farms that showcase the history and beauty of South Santa Clara Valley.

Entries are now being accepted for the 2019 Miss Gilroy Garlic Festival Queen Pageant. Royals wanted. Young women between the ages of 18 to 24 who live in Gilroy, Hollister, San Juan Bautista, San Martin, Morgan Hill, or Aromas are eligible to enter. The Miss Gilroy Garlic Festival Queen Pageant will be held on Sunday, May 19. Contestants are judged on personal interview, talent, garlic speech, and on-stage question. The winner is crowned Miss Gilroy Garlic Festival 2019 and receives a $1,000 prize. The First and Second Runner-Ups also receive a prize. Complete contest rules and online application forms are posted on the Gilroy Garlic Festival website at GilroyGarlicFestival.com. Entries must be received by 4:00 p.m. on Friday, March 8, 2019. For additional information, call 408-842-1625.

The 8 Most Common 2019 Tax Return Questions, Answered by Experts

Article written by Tara Siegel Bernard, The Times and Ron Lieber, Your Money columnist

The most important changes to the tax code in decades have taken effect — and filers are confused. We asked CPAs and other tax-prep pros to simplify things.

Some level of bafflement attends tax-filing season every year. But in 2019, as Americans examine their returns for the first time under the full effect of the sweeping new Republican tax law, the situation is the most cryptic in memory. Some tax breaks have been erased or capped, while others have been expanded or introduced.

This is equal-opportunity anxiety. Blue-state professionals feel micro-targeted by new limits on state and local tax deductions, while filers elsewhere can’t figure out why they’re no longer getting a fat refund, if the law was supposed to be so good for them.

We asked accountants across the country to tell us their clients’ most common queries. Here are some answers:

I thought my tax bill was going to decrease. What happened?

For many people living in high-tax states like New York, California, New Jersey and Connecticut, there’s one overriding reason their tax bills have risen: Their state and local tax deduction, known as SALT, will be capped at $10,000. This includes state and local income taxes, as well as real estate taxes.

“Prior to 2018, SALT was often most New Yorkers’ largest itemized deduction,” said Tina Salandra, a certified public accountant in New York.

“New York City residents, for example, often have state and city taxes that total nearly 10 percent of their income”, she added. So if your state and local taxes already exceed the $10,000 limit, you lose the ability to deduct any of your property taxes.

As a result, some families may find that instead of itemizing, it’s better to take the larger standard deduction. “But even if you can still itemize, your total deductions will be limited regardless,” said Ms. Salandra, “which may likely result in higher taxes.”Her property-owning clients with incomes in the $200,000 to $400,000 range are feeling the most significant pinch. Though their tax rates have decreased, that usually does not make up for the loss of their largest itemized deductions.

I was told there would be a tax cut for most people. So why is my return showing a tiny refund, or even an amount due?

In early 2018, the I.R.S. took its best shot at offering guidance to employers about how to change tax withholding from paychecks. In general, it suggested decreases, since the 2017 law was supposed to be a cut. That should have resulted in bigger paychecks for most people.

But if you were an employee receiving those checks, you may not have noticed the increase. If that was the case, you won’t be seeing the usual April refund: You’ve already gotten it, just parceled out into slightly higher 2018 paychecks.

Want to get a refund next year? If that’s your goal, Julie A. Welch, a Leawood, Kan., accountant, suggests using the I.R.S. withholding calculator to adjust your paycheck. Most people never bother.

Should I take the standard deduction or itemize my deductions this year?

Before breaking down what’s changed, let’s back up and explain the basics: Taxpayers are entitled to take a standard tax deduction amount, or they can itemize their deductions individually; they can deduct whichever amount is higher, resulting in a lower tax bill.

Under the new tax law, the standard deduction has doubled (to $12,000 for individuals and $24,000 for joint filers), while several itemized deductions have been eliminated or limited. TurboTax estimates that as a result, nearly 90 percent of taxpayers will now take the standard deduction, up from about 70 percent in previous years. To help you figure out the best choice, the company has posted a three-step interactive tool on its blog.

Have any popular deductions and credits changed? What did we lose, and what can I still claim?

Dependent exemption: Under the previous law, families were able to claim a $4,050 exemption for each qualifying child, but that deduction has been eliminated. Instead, if you have children under the age of 17, you may qualify for the child tax credit, which was raised to $2,000 from $1,000 for each child. More people will qualify now that the credit begins to phase out at $400,000 in income for joint filers ($200,000 for individuals), according to Claudell Bradby, a certified public accountant with TurboTax Live. The law also introduced a $500 credit for other dependents, which could include elderly parents or children over the age of 17.

Mortgage interest: If you itemize, you can deduct the interest paid on the first $750,000 in mortgage indebtedness on loans taken out after Dec. 15, 2017 (on first and second homes). Older loans are grandfathered: You can still generally deduct interest on up to $1 million in mortgage debt on loans taken out before Dec. 16, 2017.Interest on home equity loans or lines of credit are now only deductible if the debt is used to “buy, build or substantially improve” the home that secures the loan. You can no longer deduct the interest if you pay off credit card debt, for example.

Alternative minimum tax: Far fewer people are expected to be snared by it because so many of the old tax breaks that set off the so-called A.M.T. have been eliminated or reduced. In addition, the minimum exemption level has increased to $109,400 for joint filers, up from $84,500; and to $70,300 for individual filers, up from $54,300. The exemption begins to phase out at $500,000 for single filers and $1 million for joint filers.

Unreimbursed employee expenses: A number of employees’ business expenses that weren’t reimbursed by their employers — like classes and seminars — are no longer deductible.

Moving expenses: Workers moving for a new job were once able to deduct related expenses. That has been wiped away, except for members of the military.

Tax preparation fees: If you itemized, you could typically deduct the amount your tax preparer charged or similar tax-related expenses, like software bought to file electronically. This is no longer possible, unless you are self-employed.

Is it true that alimony is no longer deductible?

It depends, said Tyler Mickey, a tax senior manager at Moss Adams in Wenatchee, Washington.

Under the previous law, spouses paying alimony could deduct those payments on their returns, while the recipients had to include the income on theirs. That remains the case for divorce agreements finalized on or before Dec. 31, 2018 (unless a couple changes the agreement after then). Therefore it’s true for returns filed this year.

But for divorces completed in 2019 and later, alimony payments will no longer be deductible, and recipients will not have to include them on their returns, added Mr. Mickey, who is also a member of the American Institute of Certified Public Accountants’ personal finance specialist committee.

I heard that small business owners can’t deduct meals and entertainment anymore. Is that true?

It’s half true, said Carol McCrae, a certified public accountant in Brooklyn. You can no longer deduct entertainment or amusement, generally defined as taking a client to, say, a basketball game. But you can still deduct 50 percent of what you spend on meals, as long as you are dining with clients, traveling for business or attending a business convention (or something along those lines). The meals cannot be lavish or extravagant — so forget about the tasting menu at Le Bernardin. Providing meals to employees for an office party or a meeting, she added, are still 100 percent deductible.

There are specific rules you may need to follow. If you paid for a show and dinner on one bill, for example, it must be itemized — and the amount paid for meals must be clearly stated. If it’s not, she added, then no deduction is allowed.

Do I qualify for pass-through status and its 20 percent deduction?

The new tax laws allow some business owners — those who are set up as so-called “pass-through” companies — to deduct 20 percent of their qualified business income. Cue the rush to the tax professionals.

Most of Russell Garofalo’s clients at Brass Taxes are self-employed, but many of those who have asked him about the new rules don’t realize that they are already pass-throughs, where income passes through the business to the owner’s personal tax returns. “If you earn money without taxes being taken out, poof, you’re in business,” he said.

Anyone like that in any profession who is set up as a sole proprietorship, partnership or an S corporation (but not a C corporation) qualifies, as long as they are making less than $315,000 and filing taxes jointly, or under $157,500 for other taxpayers. Beyond those income levels and tax structures, it gets complicated and many professions get excluded. The Internal Revenue Service, the Tax Policy Center and the American Institute of Certified Public Accountshave all published good primers.

I have a taxable estate. Should I reconsider gifts I’ve given to family members?

The estate tax affects wealthy people. The amount that people can pass on to heirs without federal tax consequences has roughly doubled. In 2019, it’s $11.4 million per person.But in 2026, unless Congress acts, it goes back to $5 million (adjusted for inflation), which is what it was in 2017. State estate taxes can cloud the picture too.

Micaela Saviano, a senior manager at Deloitte Tax in Chicago, said that, especially, if you hold an investment that is likely to increase in value, it may be better to hand it down to the next generation now. That way, the growth accrues to the younger person’s estate.And paying the federal gift tax now may make sense. Otherwise, the estate may have to pay estate taxes later, using part of the estate itself.

Tara Siegel Bernard covers personal finance. Before joining The Times in 2008, she was deputy managing editor at FiLife, a personal finance website, and an editor at CNBC. She also worked at Dow Jones and contributed regularly to The Wall Street Journal.

Ron Lieber is the Your Money columnist and author of “The Opposite of Spoiled.” He previously helped develop the personal finance web site FiLife and wrote for The Wall Street Journal, Fast Company and Fortune.

Opinions expressed by contributing writers are their own.

7 Problems Keeping Your Business from being Profitable

Article written for Entrepreneur by Jayson DeMers, Founder and CEO, AudienceBloom

There are many reasons to become an entrepreneur, but no matter what yours are — even if they don’t include getting rich — your business still needs to generate a profit.

Without one, you can’t keep the doors open, and you can’t keep doing what you love.
Unfortunately, the majority of new businesses ultimately end up failing within the first few years. In large part, this is due to an inability to generate a sufficient profit, and it’s not a problem to scoff at — even businesses built on solid ideas can suffer from a lack of profitability.

So, what prevents businesses from being profitable in the first place? Here are seven major problems.

Low prices

Setting prices is one of the first and most important decisions you’ll have to make for your business. How you set your prices could easily dictate your future success. Most entrepreneurs immediately caution themselves not to set prices too high; if your product costs more than your competitors’, you could turn away your entire target market.

However, if you set prices too low, you’ll end up spending more in production than you can feasibly make back. Consider your margins carefully, and don’t be afraid to charge for quality. If you spend more time making your product better, people will be willing to pay for it.

Too much overhead

There are some things your business absolutely needs to survive. However, you may be overestimating your needs in some key areas. For example, do you really need that 3,000-square-foot office when you have only two employees you’re running the business with? Do you really need to invest in that piece of machinery that adds only a marginal value to your finished product?

Think carefully about your overhead; if you spend too much there, you could create a hole too deep to dig out of.

Too many ongoing costs

It doesn’t take much for your business expenses to start spiraling out of control; and because expenses come in so many forms, it’s hard to pin down any one area where you’re bleeding money. Think about how many people you have on staff, what you pay your vendors, how much it costs to produce a single product and even monthly variables like utility costs.

For all these potential expenses, cheaper options likely exist, along with opportunities to make cuts. So, don’t overlook them.

Unseen or hidden costs

You may have a solid expense plan worked out, but there are some expenses you probably haven’t prepared for — and they generally aren’t lumped into your “regular” expenses. For example, if your business runs into emergency repair needs, that event could instantly demand all the revenue you’ve made for the month.

If you aren’t adequately preparing for taxes or insurance costs, meanwhile, those could end up burning you, too. All it takes is a few unplanned expenses to wreck your profitability model.

Fierce competition

It’s possible that your expenses and prices are just fine, but you’re facing competition too tough to keep up with. For example, if your competitors have products similarly priced to yours but objectively better, you won’t sell enough to say alive.

So, find a way to differentiate yourself from the competition, and one-up them in at least one key area, whether that be price, quality or experience.

A lack of market awareness

You may also be suffering from a lack of market awareness; if your product is at an ideal price for both you and your customers, you still might not generate a profit if no one knows it exists. Your greatest tools to overcome this obstacle are marketing and advertising; they cost a bit up-front, but are well worth the investment if you plan them properly.

Inconsistency

There’s a chance that you have a perfect way to make your business profitable — but you’re executing too inconsistently for your business to reap the rewards. For example, your expenses may swing enormously from month to month, or your sales team might perform unpredictably based on individual variables.

Iron out these inconsistencies as soon as you can track them down. It may be tough to pinpoint exactly where your strategy is deviating, but it’s an important step if you want your profit to remain reliable.

Opinions expressed by contributing writers are their own.

Spice of Life Dinner Highlights 2019 Award Recipients

Mark Turner, President/CEO, Gilroy Chamber of Commerce

The Gilroy Chamber’s 2019 Spice of Life Dinner was “all that” and more. Nearly 300 people joined the award recipients that evening to celebrate their success and achievements. Congressman Jimmy Panetta stopped by and visited with the award winners and guests before leaving for another commitment. State Assemblymember Robert Rivas along with Supervisor Mike Wasserman stayed for dinner and the award presentations. Other elected officials included John Varela, Santa Clara Valley Water District; Mayor Roland Velasco; Vice-Mayor Marie Blankley; Council members Cat Tucker, Fred Tovar and Dion Bracco.

The evening highlighted 8 of Gilroy’s best organizations and individuals who have aimed high, worked hard and always given back to the community. The award recipients were, Man of the Year, Frank Angelino; Woman of the Year, Susan Mister; Large Business of the Year, Gilroy Chevrolet Cadillac; Small Business of the Year, CAL SILK; Non-Profit Organization of the Year, South Valley Community Church; Volunteer of the Year, Clorinda Sergi; Educator of the Year, Emily Diaz; and the Susan Valenta Youth Leadership Award recipient, Brandon Krueger, a high school senior at Gilroy Early College Academy.

Just before the 2019 Spice of Life Awards were handed out, the Chamber took a few minutes to thank and honor Christopher Ranch for their 50 year commitment to the Chamber. The evening of the dinner marked their 50th Anniversary as Chamber members. Don and Karen Christopher along with their grandson, Jason, attended the event. Jason, a third generation Christopher, who is actively involved in the operation of Christopher Ranch, accepted the recognition award.

The Gilroy Chamber of Commerce congratulates all the award recipients and thanks them for their loyalty and commitment to the Community with a Spice for Life.

Monthly Update from Visit Gilroy

Jane Howard, Director, Visit Gilroy

Each fiscal year the Visit Gilroy board of directors approves a list of goals and scope of work to meet the organization’s mission of promoting and marketing Gilroy and the surrounding area as a viable day and overnight visitor destination. Recently I met with our marketing agency Articulate Solutions for a six month “check-in” on how we are doing to meet these goals and to receive a status update. I am pleased to report we are on target to achieve our goals and the results are impressive. Following is a summary of the status update through December 31, 2019:

A. Visitgilroy.com website visitation and social media engagement
a. Unique visitors – 56,056 (56.8% to goal for mid-year)
b. Social Media
i. Facebook followers – 6.5% increase over prior 6 months
ii. Instagram followers – 10.5 % increase over prior 6 months
iii. Twitter followers – 1.1% increase over prior 6 months

B. Advertising Campaigns and Brand Awareness
a. 5,425 website referrals to Gilroy lodging properties
b. Print and digital campaigns with Via Magazine, Edible Silicon Valley, Trip Advisor, Yosemite Journal, Horizon Travel Magazine,
Canadian Traveler Magazine and GMH Today Magazine
c. 5 articles submitted and 17 Facebook Posts – Central Coast Tourism Council (CCTC) website
d. 9 articles submitted – Visit California website and e-newsletters

C. Visit Gilroy monthly e-newsletter
a. 73,013 e-newsletters delivered
b. Average Open Rate – 12.4% (1.6% increase over prior 6 months)
c. Average Click Rate – 2.21% (.8% increase over prior 6 months)

D. Public Relations
a. Hosted 2 digital influencers for multiple day visits
b. Launched Road to Garlic campaign
c. Attended Visit California San Francisco Media Reception
d. Added 369 new contacts to Visit Gilroy media list
e. Value Equivalency Report (VER) July – December 2018 = $87,665

In summary, Visit Gilroy is successfully delivering the goods to bring more visitors to Gilroy. For the remaining six months of our fiscal year (ending 6/30/19) we will continue the current strategies and spend resources to launch advertising at San Jose International Airport, attending IPW in Anaheim and rebranding as California Welcome Center Gilroy. Keeping an eye on our goals is important and measuring results is critical to achieving them. Visit Gilroy is focused daily on our mission of increasing visitation to Gilroy. 

Gilroy Chamber to Host Mayor’s State of the City Address

Mark Turner, President/CEO Gilroy Chamber of Commerce

What’s ahead for Gilroy? What’s the economic outlook for our community? What vision does the Mayor and Council have for our City? What challenges do we face and what opportunities exist?

The Gilroy Chamber of Commerce will once again host Mayor Velasco’s State of the City address on Thursday evening, March 7, 2019 from 6:00 – 8:00 p.m. Join us as we hear the Mayor address these questions and more.

The State of the City Address will take place at Old City Hall Restaurant. The cost is $45 and dinner will be served. Contact the Chamber to make reservations or go to gilroy.org.

Guidance for California Employers on Agricultural Overtime Pay

Article written by Kate Culliton, Editor, CalChamber

The California Labor Commissioner has posted guidance for agricultural employers and workers about new overtime requirements that went into effect January 1.

To help employers comply with the new requirements, the Department of Labor Standards Enforcement (also known as the Labor Commissioner’s Office) published a timetable that employers can view for when agricultural employees should receive overtime pay. The Labor Commissioner has also published Frequently Asked Questions.

For the first year, which started January 1, 2019, agricultural workers at large businesses earn overtime pay for all hours worked over 9.5 hours in a day or 55 hours in a workweek. Small employers have an additional three years before the changes to daily and weekly overtime pay take effect.

“We encourage large and small agricultural employers in the state to note the new farmworker overtime pay requirements that will phase in until a 40-hour standard workweek is reached,” said California Labor Secretary Julie A. Su, in a statement.

Agricultural workers are defined in Wage Order 14 and include employees who are engaged in the preparation and treatment of farmland as well as the care and harvesting of crops. Wage Order 14 was recently updated in January 2019. Spanish and Chinese versions will be available soon.

Failure to pay proper overtime wages can result in a civil penalty of $50 per pay period for each underpaid employee.

California agricultural employers need to be aware of these new overtime requirements. The requirements also vary depending on how many employees you have.

Workers Waiting “On Call” Must Be Paid, Court Rules

Article written by Bob Egelko, San Francisco Chronicle Staff Writer

Employees who are required to stay “on call” before the start of a possible work shift — phoning their employer two hours before the shift to learn whether they’re needed — are entitled to be paid for that two-hour period regardless of whether they’re called in to work, a state appeals court ruled Monday.

In a 2-1 decision with potentially broad impact, the Second District Court of Appeal in Los Angeles said on-call employees are protected by a 1943 California Industrial Welfare Commission wage order, still in effect, that entitles employees to “reporting time pay” as soon as they are required to report for work.

The employer in this case, a retail clothing store, argued that the law mandated payment only for the hours an employee was required to report at the workplace. But the appeals court said the law also protects employees who are required to report in by telephone, committing their time to the employer.

Workers facing on-call shifts “cannot commit to other jobs or schedule classes during those shifts,” must make child care arrangements and have to give up time for recreation or socializing, said Presiding Justice Lee Edmon in the majority opinion. By contrast, she said, “unpaid on-call shifts are enormously beneficial to employers,” who can maintain a “large pool of contingent workers” and pay them only if they need them.

In dissent, Justice Anne Egerton said the 1943 reporting time order was intended to require pay only for employees who “must physically appear at the workplace” and that any changes should be left to the Legislature. She noted that a federal judge had interpreted the law that way in a separate case, although the federal ruling is not binding on other courts.

The ruling is “a great victory for employees,” said Patrick McNicholas, a lawyer for the sales clerk who filed the suit after being denied pay for time spent on call. McNicholas said many retail stores and restaurants follow a similar practice.

There was no immediate comment from lawyers for Tillys, the clothing store in Torrance (Los Angeles County) where the clerk worked in 2012. The apparel chain Abercrombie & Fitch filed arguments supporting Tillys.

Tillys, based in Irvine, requires employees with on-call shifts to call in two hours before the shift would start and disciplines those who call in late or not at all, with potential firings for three violations.

The appeals court agreed with the employers that, when the 1943 “reporting time” wage order was written, employees reported to work by showing up at the workplace. But the court said the law was not drafted narrowly and must be interpreted in light of changing realities and technology.

For example, Edmon said, a 1978 state law that allowed members of a nonprofit mutual benefit corporation to copy other members’ “names and addresses” was interpreted by a state appeals court in 2010 to allow copying of email addresses as well.

Employers are requiring their employees to “report to work” when they mandate call-ins two hours before the start of a possible work shift, the ruling said. It said requiring pay during call-in time encourages employers “to accurately project their labor needs and to schedule accordingly,” and to “partially compensate employees for the inconvenience and expense associated with making themselves available to work on-call shifts.”

What’s New with Business?

Eric Howard, Business Relationship Manager, Gilroy Chamber of Commerce

Each year more than three million high school students take the SAT or ACT, the college entrance exams required by most four-year colleges in the United States. For decades, however, there have been questions about exactly what these tests measure, what role they play in the admissions process and how predictive they are of academic success.What are college entrance exams really measuring? On Thursday, February 28 at 6:30pm, Mount Madonna School will host a film screening of “The Test and the Art of Thinking” at the Community Playhouse in Morgan Hill. $5, tickets available at MMS-FilmScreening.bpt.me.

Katherine Filice, co-owner of Articulate Solutions, has recently had two of her works selected as finalists for the International Artist Grand Prize Competition (I.A.C.) in Taipei. Organized by the Taiwan International Contemporary Artist Association, this is one of Asia’s top art contests. Over 4,200 works were submitted from artists representing 81 different countries. Of those, only 371 were chosen as finalists to be featured in the exhibit from April 25-29 at Art Revolution Taipei. To have not just one but two works selected (both from her series “The Place in Between”) is an incredible honor. Her piece Kate & Anthony was selected to be exhibited among the incredible ArtCan talents at Elevate, which opens in London on February 6. Congratulations to our local artist, Katherine Filice.

Spice Up Your Art Portfolio. Enter the 2019 Gilroy Garlic Festival Art Poster Contest. Artists across the country are invited to submit their original artwork for the chance to win cash prizes in the 2019 Gilroy Garlic Festival Art Poster Contest. The first-place winning entry will be reproduced as a high-quality, limited-edition poster to be sold at the 41st annual Gilroy Garlic Festival on July 26, 27 and 28, 2019. Entries must be received at the Gilroy Garlic Festival Association office by 4:00 pm on Friday, March 15, 2019. For complete contest rules and online application, go to gilroygarlicfestival.com/festival/poster-contest or call 408-842-1625.

Young ladies who are passionate about the western lifestyle and promoting the rodeo industry can run for the title of Miss California Rodeo Salinas and become an ambassador for the largest professional rodeo in the state. Entries for the 2019 contest open on February 14 and close on May 6. The competition is open to young women between 18 and 21 years of age who are representing either a recognized horsemen’s organization or another recognized non-commercial community organization. The winner will travel to various events promoting the California Rodeo Salinas throughout the year. Full contest details and a digital application form can be found at https://www.carodeo.com/p/about-us/mcrs/2019-miss-california-rodeo-contest-entry-info.

When is Enough Enough?

Mark Turner, President/CEO Gilroy Chamber of Commerce

Below is an article by Luara Curtis, Policy Advocate for CalChamber regarding the never-ending bills introduced and passed in Sacramento. Too often, these bills are unnecessary and create an excessive burden on small businesses already struggling to keep up. Each year, the Gilroy Chamber of Commerce partners with CalChamber advocating for our local businesses by opposing job killing legislation. The Gilroy Chamber of Commerce diligently reviews proposed bills and will continue to fight on behalf of our business community always working to ensure a strong local economy.

We often hear from our members that the California Legislature churns out too many new laws each year and the 2019 Legislative Session is likely to be more of the same. California businesses struggle annually to comply with an ever-changing landscape, both with new statutes enacted by the Legislature (last year was a record with 1,016 new laws), as well as hundreds more regulations adopted by administrative agencies (between 500-600 new regulations each year according to the Office of Administrative Law).

This number is significant, however, considering that the Legislature introduces approximately 2,500 bills each year, it could be worse. For example, in 2018, there were 2,637 bills introduced. CalChamber positioned on 219 bills, 134 of which were opposed positions. Out of the 134 opposed, CalChamber identified 29 Job Killers. All of the Job Killers were stopped in 2018, and out of the other bills CalChamber opposed, only 26 made it to the Governor’s desk, with approximately half being vetoed.

One area that is regularly active with new laws is labor and employment. In looking back over the past few sessions, we can see that nearly 50 new laws are added every session. From the 2017-18 Session, there were 48 new laws enacted; from the 2015-16 Session, there were 64 new laws enacted; from the 2013-14 Session, there were 63 new laws enacted; and, from the 2011-12 Session, there were 56 new laws enacted. While all of these new laws are not significant, substantive changes, and may just be more technical in nature, the sheer volume of new laws and regulations is overwhelming and represents a huge burden, financially and administratively, for businesses operating in California, particularly small businesses.

Small businesses often do not have the means to hire in-house legal counsel or a Human Resources team to keep up with the changing laws. I cannot imagine opening say a cupcake shop in California. It is one thing to be a great baker, but having to keep up on California’s labor and employment laws with changes each year would be impossible for someone just trying to run a business in the Golden State. One of the ongoing challenges to the business community is to educate the Legislature that it isn’t necessary to pass 50 or 60 new laws every year in the labor and employment space, or any other area.

Hopefully the Legislature will take Governor Newsom’s Inaugural Address to heart when he said “And those who dream of building something of their own – a restaurant, a bookstore, a family farm – they will get our support” by passing fewer laws regulating California businesses.