Tuesday, February 23, 2016




    If all goes according to the plans of a relatively new environmental agency, the most progressive part of California will soon inflict the most regressive tax known to America upon all its residents.

    Because the wetlands around San Francisco Bay are fast drying up, with many thousands of acres developed and wildlife habitats threatened and shrinking, the seven-year-old Bay Restoration Agency wants to add $12 a year to the tax bill for each parcel of land in nine counties surrounding the Bay.

          That’s right, the owner of a one-room shack deep in the Hamilton Range of Alameda and Santa Clara counties would pay the same $12 assessed against the billion-dollar complexes of companies like Google and Apple Computer in the heart of Silicon Valley. Yes, they are each built on several parcels, so their parcel tax levies each might total $120 or so, still as unfair as it gets.

          But parcel taxes have gradually become the rage in California over the last 40 or so years. This happened largely because of the 1971 Serrano v. Priest decision of the California Supreme Court, which sees more than half of most new property tax assessments by school districts sent to Sacramento for dispersion among the poorest districts in the state. Parcel taxes are the only kind whose take stays completely at home, to be used for local purposes where it is raised.

          In some cities, this sees factories and luxury hotels paying the same amount as owners of small houses or one-bedroom condominiums. Renters see all or most of such levies passed through to them.

          Even backers of many parcel tax plans often admit the levy is inherently unfair, taxing the poor the same amount as wealthy corporations. That’s one reason some parcel taxes exempt property owned by senior citizens.

          As with schools, which use the money for everything from construction to curriculum, the cause for the proposed new 20-year Bay area parcel tax is admirable. The levy will be up for a vote in the June primary election in all nine counties involved, with a two-thirds vote for approval needed for passage.

          It would raise about $500 million over two decades, funding clean water projects, pollution prevention and restoration of about 35,000 wetlands acres along the shores of the Bay. That would just about double the land area now available to the approximately 1 million shore birds in the area, which contained about 200,000 wetland acres at the time of the Gold Rush. It would also improve commercial fishing for herring and other species.

          Much of the land to be restored can easily be seen from airplanes landing at San Francisco International Airport – the salt flats once owned by the Leslie and Cargill companies, which are now available for restoration with no funds available for the work.

          Another aim of the project would be to protect the wetlands and nearby cities from rising sea levels predicted by most climate scientists. The Restoration Authority operates on the belief that rising oceans could push water levels in the Bay up by more than three feet before the end of this century, with shoreline areas in Marin County and the East Bay most vulnerable to the flooding. Schools, airports, seaports, freeways, electricity generation and much more would at peril under that scenario, which the new money is supposed to mitigate.

          “This parcel tax will bring in more money…and could be used as a leverage for federal matching funds,” said a scientist for the environmental group, San Francisco Baykeeper. He complained that other wetland areas like the Chesapeake Bay, Puget Sound and the Everglades now get far more in federal conservation funds than the Bay area, which gets only about $5 million a year in federal water quality improvement funds.

          The money would also build new hiking trails and improve availability of swimming and boating.

          That’s all admirable, as are the improvements to public schools now largely paid for by parcel taxes. But it doesn’t make parcel taxes equitable.

          While the Bay area parcel tax proposal is supported by the likes of the Save the Bay, the Silicon Valley Leadership Group and Ducks Unlimited, there is no significant opposition, largely because the amounts at stake seem insignificant to wealthy interests.

          But it remains to be seen if a two-thirds majority of voters even in the ultra-liberal, environmentally-friendly Bay area will vote to tax themselves unfairly for decades to come.

    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, go to www.californiafocus.net




          As corporate profit reports rolled in this winter from the gasoline refining industry, the case for gas price gouging grew steadily stronger.

          Start with the profits of the largest refiners operating in California. Then proceed to strange activities by an oil tanker, ExxonMobil’s SR American Progress. Close with hard figures provided by the state Energy Commission’s senior fuels specialist during a mid-February hearing. Look also at the almost 80-cent price differential between gasoline here and the average price everywhere else in the continental U.S.

          The profits: An analysis (so far unchallenged) by the Consumer Watchdog advocacy group found the state’s second-largest refiner, Tesoro, also known as tsocorp, netted $1.9 billion in profits last year from California refining operations. At a time when crude oil prices were lower than they’ve been in half a generation, Tesoro, maker of 27 percent of this state’s gas (marketed under the USA and Shell labels, among others), took $423 million in fourth quarter profits alone.

          Meanwhile, Valero, the state’s No. 3 refiner, netted $852 million in California last year. Valero is the only refiner reporting California-specific data. Its 2015 profits were four times Valero's average annual take since 2010, which was just over $216 million per year.

          Chevron, the state’s gasoline-producing leader with a 28 percent market share, does not break out California operations, but had worldwide refining profits last year of $3.1 billion. More than half the company’s worldwide refining is here.

          Refining profits in California, then, set records even as the price of crude oil dropped sharply through the year to generation-low levels, along with the profits of most other oil companies. Many responded by laying off more than 200,000 workers and decreasing investments in oil exploration.

          The usual excuses for keeping California prices almost a dollar higher than elsewhere included both complaints about the state’s gasoline and refining taxes and claims of short supplies caused by a long outage at ExxonMobil’s refinery in Torrance.

          But that doesn’t explain the voyage of the American Progress, which Consumer Watchdog analyst Cody Rosenfield reported was “suspiciously hidden in (and near) Singapore for 70 days during the peak of California’s gas price crisis.” ExxonMobil did not deny this odd stay, which was only partly in port and occurred while gas prices in the Los Angeles area were $1.50 more than the U.S. average, some stations selling fuel for as much as $5.49 per gallon.

          ExxonMobil has two refineries in Singapore making gas to California specifications, but when the 30,400-ton American Progress eventually reached California with a full load, it offloaded nothing, but proceeded on to Florida with that gas.

          The company, which normally makes about 10 percent of California gasoline, said only that it “has operated responsibly and in strict compliance with all laws.”

          So in the unlikely event there was a lasting shortage, it was at least partly caused by an ExxonMobil decision to keep things that way.

          Meanwhile, Energy Commission senior analyst Gordon Schremp reported that only about half the California price differential can be attributed to taxes: 10.3 cents per gallon for the cap-and-trade levy, 4.3 cents per gallon in costs for making gas to the state’s low carbon fuel standard and 30 cents per gallon in excise taxes – the total about 45 cents per gallon.

          The refiners’ record profits, then, came from the additional almost 40 cents per gallon in differential between California prices and those elsewhere.

          The industry insists it does not and has never operated as a cartel, yet none of its major players has broken with the pack in recent years and cut prices down to average U.S. levels, plus the California taxes.

          Instead, the industry’s group, the Western States Petroleum Assn., said in a emailed statement from its president, Catherine Reheis-Boyd, that “Over the past decade, state and regional agencies have promulgated a long list of new regulations that has increased the isolation and uniqueness of California’s fuel market… It is important…to take into account the contributing factors that influence California’s fuel markets.”

          But even when those factors are accounted for, as Schremp did, there’s still that windfall of almost 40 cents per gallon.

          As long as that remains unexplained, Californians will be more than justified in assessing the refiners’ behavior as similar to a cartel, and the prices they charge as the very definition of gasoline gouging.


    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

Monday, February 8, 2016




          Just a few months ago, it seemed as if the November election might produce the silliest “silly season” ever seen in modern California politics. But the essential good sense of shoppers around the state appears to have prevented that.

          It’s shoppers at big box stores like Home Depot, Best Buy, Target, Walmart and Costco who provide the bulk of voter signatures needed to qualify initiatives, referenda and recalls for the ballot. Sometimes there’s a fear that these shopper/voters will sign just about anything merely to get the petition carriers near the entrances out of their hair.

          Plenty of silly measures were proposed for this fall, but virtually none made it through the process of gathering 365,885 valid signatures, even though that’s the lowest total required in many years, the result of the very small turnout in the 2014 election.

          One would have required display of the California state flag in the position of first honor when both it and the American flag are on view at public buildings from schools to stadia. Not only would this be offensive to many, but it also would have no discernible benefits.

          There was also a plan to ban political contributions of all kinds from out of state donors to most campaigns conducted in California. Federal offices like U.S. Senator and members of Congress would have been exempt. Likewise, a plan to change the title of California’s chief executive from governor to president didn’t come close to getting the signatures needed to put it on the ballot.

          Neither did a proposal to demand that anyone proposing a ballot measure advocating the killing of gays and/or lesbians (there was just such a proposal; it also went nowhere) would have to attend sensitivity training or donate money to a pro-gay or -lesbian organization.

          A plan to multiply the membership of the Legislature by about 100 also failed, but might be back. Another failure aimed to ban sales of shrimp and other shellfish. This one carried a $666,000 fine and/or a prison sentence for each sale.

          Also not making the ballot were a couple of referenda, measures aiming to reverse new laws passed by the Legislature and signed by the governor (still not California’s president). One would have allowed anyone to avoid getting children vaccinated simply by stating thast personal beliefs forbid it. Another would have reversed the new (and not yet in effect) law allowing doctors to administer lethal doses of drugs to terminally ill patients. A move to recall Democratic state Sen. Richard Pan of Sacramento for authoring the current law requiring almost universal vaccination of schoolchildren failed, too.

          Some of these ideas would have had to be taken seriously by their opponents, who in a few cases were ready to spend millions of dollars fighting them off. Others would simply have cluttered a ballot that already figures to be the longest ever.

          Their absence leaves voters to consider what is likely to be dozens of very serious ideas, most with significant consequences.

          There could be, for example, three or more measures to boost taxes. Two aim to extend the levies of the 2012 Proposition 30, which mostly upped taxes on the wealthy. A third would surcharge tax bills for properties officially valued at $3 million or more, the new money going to anti-poverty programs. That’s intended as a sort of Robin Hood system.

          Tax cuts are also likely to be present and a plan to lift the minimum wage to $15 an hour by 2021 might also make the ballot.

          So could a plan to increase the time of service public school teachers need to earn tenure from two years to five, and another limiting the pay of non-profit hospital executives to the same level as what the President of the United States earns – now $450,00 a year.

          There are more, with four measures already assured ballot spots, 73 others now authorized to collect signatures and almost two-dozen awaiting official naming by the attorney general. The only one without wide implications is one to require use of condoms in all movie sexual intercourse.

          That’s all silly enough – but it could have been much worse.


    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net




    Turn on the TV next time a NASCAR stock car race is on and get a good look at the coveralls worn by the drivers. They are covered with patches bearing the logos of many and varied companies that sponsor their automotive efforts, from oil and carmaking companies to breweries.

        Now imagine a normally staid state legislative hearing, where politicians of both major parties today show up in conservative business suits. Those folks could soon look like a stock car racing crew if an initiative now circulating makes the November ballot and passes.

        The measure, formally called the “Name All Sponsors California Accountability Reform (or NASCAR. Get it?) Initiative,” would require all state legislators to wear the emblems or names of their 10 top donors every time they attend an official function.

        The measure’s sponsor, Rancho Santa Fe businessman John Cox, takes delight in the idea and has already done some touring around California with 120 life-size photographic cutouts of politicians dressed up as they might have to under his plan.

        This idea has some similarity to part of the defeated 2006 Proposition 89, an attempt to set up a publicly financed election system that would also have required every privately-financed political ad, whether on television or in newspapers or mailed flyers, to list its three biggest financiers in type as large as the biggest print anywhere else in the ad.

        That proposition lost, but not because of the donor exposure provision. It went down by a 76-24 percent margin because voters didn’t want to be taxed for the sake of politicians.

        There’s no tax associated with the NASCAR initiative, which Cox, a former chairman of the Cook County (Chicago) Republican committee, is willing to finance to the tune of $1 million.

        “The whole idea is to hold the entire corrupt, stupid system up to ridicule,” said Cox, who ran unsuccessfully in Illinois for both Congress and the U.S. Senate before moving to California in 2008.

        One who appreciates the sentiment behind this is Jamie Court, head of the Consumer Watchdog advocacy group, which sponsored Proposition 89. “This could definitely make politics more racy,” he said. “If this passes, it could turn the statehouse into a nudist colony because no one would want to pin their real owners onto their clothes. We might even discover that the emperors really don’t have any clothes.”

        There is, you might guess, some question over whether forcing lawmakers to wear signage is constitutional, or might be a violation of their First Amendment free speech rights. Of course, no one forces them to be legislators, any more than stock car race drivers are dragooned into that calling.

        Cox, for one, would welcome a court challenge on the constitutionality of dictating dress in the state Capitol. “That would be wonderful,” he said. “The real point here isn’t to force anyone to wear anything, but to fix our broken, ridiculous system. It’s a system where people who want things from government pay for and staff the campaigns of the folks who will run that government. Any objective person would call that corrupt.”

        Cox, however, stops short of calling California more corrupt than his old Chicago stomping ground. “I haven’t lived here long enough to make that comparison,” he said.

        He’ll need 365,880 valid voter signatures to qualify this idea for the ballot, and Cox is convinced his $1 million commitment will be more than enough to pay for getting it on the ballot.

        “The petition drive outfit we’ve hired says this is the biggest slam dunk they’ve ever seen,” he said. “They’re having the petition carriers use it as a lead item to make it easier for them to get signatures for other initiatives.”

        He’s also trying to do much of the petition drive online, the measure providing printable sheets with room for only three signatures, thus making it easier for backers to get a full sheet to send it in.

        The bottom line: For anyone who wants to afflict the powerful and make lawmakers feel anxious and perhaps a bit threatened, this could be a strong – also amusing – vehicle.

    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, the Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net

Monday, February 1, 2016




          To understand the brazen quality of the latest rate increase application from California’s third-largest electric utility, it’s necessary to step back in time, to the scene when wildfires raged across some of the prettiest parts of San Diego County in 2007.

          Those fires would eventually kill 13 persons, even more than the notorious natural gas pipeline explosion that came about three years later in San Bruno, which ever since has plagued the state’s largest utility, Pacific Gas & Electric. Physical damage from the fire was far more widespread.

          Just after noon on Oct. 21, 2007, arcing power lines owned by San Diego Gas & Electric Co. were whipped by dry winds of up to 100 mph, eventually starting a small fire near Ramona, in eastern San Diego County. Known as the Witch Creek fire, by 4 a.m. the next day, this blaze had grown exponentially and reached the San Diego city limits. It combined with two other fires, eventually burning down whole neighborhoods – a total of more than 1,125 residences. More than 197,000 acres burned, but not in rural country like some of last fall’s big fires. This was high-priced residential real estate.

          Evacuations were ordered over the almost three weeks the blaze burned, in cities from Oceanside and Encinitas, Del Mar Heights and Carmel Valley, Rancho Santa Fe and the heavily afflicted Rancho Bernardo. And there were more. These eventually involved about half a million people, the largest evacuation in California history.

          Now fast forward to SDG&E’s newest rate increase application. Following the examples of PG&E and Southern California Edison, SDG&E asks the state Public Utilities Commission to have its customers pay 90 percent of its approximately $380 million in fire-related expenses. This would amount to about $1.67 per month per customer.

          No talk here about the company compensating affected customers for their own fire-related costs, as one might think fair.

          The case creates a major test for the PUC, whose new president, Michael Picker, has promised more transparency and adherence to rules preventing private contacts between commissioners, their staff and utility executives during rate cases. Such contacts have long been common, despite violating many rules and regulations.

          The 2007 fire, caused primarily by the combination of SDG&E equipment and severe weather conditions, spurred about $4 billion in claims, many not covered by insurance.

          But SDG&E, obligated to serve fire-prone areas and pay damages linked to power line problems whether or not negligence was involved, says having customers pay 90 percent of its costs is consistent with another state decision on a hazardous waste cleanup.

          This does not change the fact that asking customers – many of them victims of the fire – to pay the vast bulk of the bills is like someone helping cause a car accident that injures another party and then expecting that person to pay most of the damage expense.

          This would never fly in a private negotiation, but we are talking about a state commission with decades of experience favoring utility companies over their customers.

          SDG&E doesn’t say this, but it has plainly seen that Southern California Edison won a deal having customers foot about 70 percent of expenses linked to the shutdown of the San Onofre Nuclear Generating Station, caused mostly by an Edison blunder. It has seen PG&E get sweetheart terms on the penalties assessed against it for San Bruno. And SDG&E has seen the thus-far lenient treatment the PUC has given the Southern California Gas Co. (with which it shares a parent company – Sempra Energy) in the massive ongoing methane gas leak near Porter Ranch in Los Angeles.

          If Picker is serious about changing the culture of the commission, as he claimed in his state Senate confirmation hearings, the SDG&E rate case is a big chance to make a statement.

          The bottom line: If SDG&E ends up paying only about 10 percent of its expenses from a hugely traumatic fire caused in large part by its equipment, the PUC will be saying it’s business as usual. The companies ask for money and the commission reaches for the wallets of customers. Only if the proposal is cut by much more than half will there be any reason to think there’s been any change at this steadfastly corrupt commission.

    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net




          There’s probably no hope of stopping the revolving door in Washington, D.C. anytime soon. The constant cycle of longtime Congress members and senators moving downtown from the Capitol to take high-paying jobs as lobbyists can only be ended by Congress itself – and the prospect of big paychecks to come makes it very unlikely many so-called “citizen politicians” will ever vote to end that.

          But Sacramento is different. On the surface, it’s much the same, of course. Legislators move easily and often from the Assembly or state Senate to lobbying jobs just as lucrative as any to be had in the nation’s capital. The difference is that the people of California can effectively end this practice anytime they like, via the initiative process.

          The latest example of a state lawmaker taking a far more lucrative job on the side of big business came just this winter, when five-year Democratic Assemblyman Henry T. Perea departed office with a year to go in his third term, taking a job advocating for the Pharmaceutical Research and Manufacturers of America, usually referred to as PhRMA. It is the main lobbying group for the drug companies often called Big Pharma.

          Perea, the son of former longtime legislator and current Fresno County Supervisor Henry Perea, will be advocating for Big Pharma in both California and Nevada, with the Nevada capital of Carson City not very far from his new Sacramento office.

          He’s the third California legislator in the last 30 months to leave for a higher paycheck as a lobbyist – even though state law says he can’t actually schmooze or gift his former colleagues until the end of this year. That’s right: Legislators only have to wait 12 months before coming back to advocate directly among their old colleagues.

          Before Perea waltzed down the path toward a much bigger paycheck, former Democratic state Sen. Michael Rubio of Shafter moved to a job with Chevron and former Republican state Sen. Bill Emmerson of Riverside County moved to the California Hospital Assn. And that's just within the last 26 months.

          Perea made just over $97,000 a year in the Legislature; his new employer isn’t announcing his salary, but bet on it being at least double what he drew in office. Perea, father of two young children with a third on the way, probably can use the extra cash. Big Pharma had invested in him earlier, too, donating nearly $50,000 to his campaigns in the 2013-14 election cycle.

          This is enough to make some wonder whether the new job might be a reward for past favors, perhaps even a reward that was promised even before those favors were done.

          The very short one-year lobbying prohibition makes it attractive for big industries to hire lawmakers who once voted on bills vital to their interests. Twelve months often isn’t long in the life of a bill, and after that time is up, former lawmakers like Perea can be right back in the Capitol advocating among their buddies. Not that he won’t be seeing them elsewhere before then.

          Perea, whose unofficial bio says he was “known for his skill at working the floor in the Legislature,” will be doing that again very soon. He also won’t have to worry any more about which fellow legislators he pleases or angers with his votes. Everyone will know where he stands – right where his employer tells him to.

          Even before he can officially lobby anyone in the Capitol, Perea this fall will probably be instrumental in the campaign against a prospective ballot measure that aims to limit drug prices paid by Medi-Cal and other state programs to levels negotiated by the federal Veterans Administration.

          It’s a joke for legislators to be able to come back and lobby their pals so soon after leaving office. There ought to be at least a five-year waiting period for them, which might cause second thoughts for some who enter politics just to get on the gravy train.

          This will not happen in Washington, D.C. in the foreseeable future. But it could happen in Sacramento if citizens get sufficiently fed up with legislators like Perea parlaying elected jobs into high-paying posts as influence peddlers.

    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net