WILL INSURANCE BLACKMAIL WIN OUT AGAIN?

 

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, SEPTEMBER 22, 2023 OR THEREAFTER

BY THOMAS D. ELIAS

    “WILL INSURANCE BLACKMAIL WIN OUT AGAIN?”

 

        Historically, the only effective deterrent to blackmailers is to get tough on them, fighting back and not giving in to their demands.

 

        Historically, also, California has a history of doing the opposite when it comes to insurance, letting companies that have lost money during natural disasters blackmail the state to escape risks that traditionally come with selling insurance.

 

        It appears about to happen again now, in a development that looks similar in many ways to the last successful insurance company blackmail, which took place in the 1990s.

 

        Prior to the big urban-area earthquakes that struck California in 1989 and 1994, insurance companies selling property insurance here also had to offer earthquake insurance policies.

 

        But no more. Those big temblors caused so much damage and so much insurance company loss that the companies declared they would stop selling homeowner and other property policies here unless they could escape from writing quake policies. They did just that.

 

        The insurance commissioner at the time, Republican Chuck Quackenbush, had been elected largely with insurance company donations. He quickly caved to the insurance company blackmail and led the Legislature to create the California Earthquake Authority, which now sells policies through actual insurance companies, which are not themselves on the hook for earthquake damages.

 

        Now the same companies, State Farm, Allstate and Farmers, plus AmGuard and Falls Lake Insurance, are using a similar blackmail tactic by again stopping property policy sales in the state, this time demanding a surcharge on all California property insurance to help pay for their losses from wildfires, floods and other disasters at least partially caused by climate change.

 

        They also want to base future rates on climate change projections of more severe fires and storms, rather than getting reimbursed by rate increases after those events occur, if they ever do. Farmers took matters a step further, announcing 2,400 layoffs.

 

        “This is pure blackmail,” says consumer advocate Harvey Rosenfield, author of the 1988 Proposition 103, which has regulated insurance rates since then. “They’re saying, ‘Give us more money or we’ll pull out and even cancel existing policies.’”

 

        Here’s the likely state response, as predicted by Rosenfield and the Consumer Watchdog advocacy group he founded: A last-minute legislative bailout.

 

        But here’s the proper response: Current Insurance Commissioner Ricardo Lara and Gov. Gavin Newsom need to tell companies which won’t sell property insurance here they also won’t be selling car insurance in the world’s largest automotive market and also won’t be allowed to sell life insurance, their most lucrative current product.

 

        So far, there is no sign of that kind of toughness from either Lara or Newsom.

 

        Reality is that the insurance companies want to keep making big profits even in periods when they have to pay up on their policies. That is the big reason Farmers recently also pulled out of the Florida property insurance market, where it has taken losses from frequent and severe hurricanes.

 

        But risk is at the root of the insurance business. Proposition 103, which has saved consumers more than $13 billion over the last 35 years, allows insurance companies to raise rates when justified by the payouts they’ve made. The companies want more. They want license to raise rates to an almost unlimited extent and they want to charge low-risk customers who live outside wildfire areas for the risks they assume by insuring other people.

 

        So, in addition to telling the big companies that if they won’t sell one kind of insurance, they can’t sell others, California needs to require that companies price their policies higher in high-risk areas than other places.

 

Folks who choose to live in the safest areas should not have to subsidizing others who want to enjoy the beauty and adventure of forest living. Homeowners in wildfire areas know the risks before they move there.

 

        But the legislators who might this fall give in to the insurance company demands know they are politically safe, whatever they do, so long as they run under the Democratic Party label.

 

        Which means insurance company blackmail will likely  succeed again this time, just as it did in the 1990s.

 

    -30-

    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

RENTERS NOW GETTING SLAMMED, RIGHT ALONG WITH HOME BUYERS

 

CALIFORNIA FOCUS
FOR RELEASE: TUESDAY, SEPTEMBER 19, 2023, OR THEREAFTER

BY THOMAS D. ELIAS
     "RENTERS NOW GETTING SLAMMED, RIGHT ALONG WITH HOME BUYERS”

 

       A UC Berkeley study the other day concluded that home buyers in California now pay double each month what apartment dwellers shell out for rent.

 

       That’s right: It takes twice as much ready cash to live in this state as a new homeowner than as a renter, for a comparable property.

 

       That’s also the conclusion of a year-long study by Dwellsy, a Los Altos-based Internet platform that often assists renters in finding houses, townhomes, condominiums and apartments.

 

       Despite the high levels of today’s California rents, this is a new reality, spurred in part by the steadily

rising interest rates on today’s mortgages. It means that fewer folks than ever can afford to buy, and helps

explain the relatively new California reality which sees renters making up well over half the populace.

 

       But Dwellsy CEO Jonas Bordo believes that most folks can still afford fairly financially comfortable

living, even as both home prices and rents begin rising again after a pause – or for owner-occupied homes,     a bit of a slowdown over the last few months of uncertainly about the national debt ceiling.

 

 

     For sure, neither rents nor home prices have been major contributors to the severe inflation that has afflicted most of America, and especially California, this year. “The normal seasonal rent cycle typically has prices increasing from April through October, so the bump right now is not unexpected,” said Bordo. “When you take the long view, renters are coming out on top.” Since April 2022, asking rent for one-bedroom apartments has decreased 0.8 percent, or $11 per month nationally. And since January 2021, it has gone down 1.9 percent.

 

 

     Overall, rents for one-bedrooms were up just $14 in March and April, the most recent months measured by Dwellsy. Meanwhile, house payments skyrocketed in California, even as base prices are down a bit. Typical house payments for just-sold median-priced homes that in this state carry price tags around $800,000 include a $3,000 monthly interest component when buyers get loans in the 4.5 percent range.

 

     

     The interest alone is more than typical renters pay in California’s priciest markets for one-bedroom apartments. In the state’s most expensive metropolitan area, San Francisco-Oakland-Hayward, the typical one-bedroom now goes for $2,495 a month. In nearby San Jose-Santa Clara, the price is exactly $100 less. And in the Los Angeles-Long Beach-Santa Ana area, it’s “only” $2,070. That still means renters must have a monthly income topping $5,000 to be comfortable unless they are roommates sharing the expense. So without doubling or tripling up, things are still not affordable for most residents of this state’s urban areas.

 

      But a bunch less pricy than if they were new home buyers.

 

      This is rarely mentioned when realtors gripe that sales have been down this spring and summer, running about 45 percent below last year’s volume. But when new buyers must come up with more than $40,000 in yearly mortgage payments and then add taxes and insurance into the mix, who can be surprised when some look to other states as financial solutions? Especially since most employers remain comfortable with the remote work ethos imposed on many by the coronavirus pandemic.

 

      All this is good news for renters. For when current homeowners need to raise money to cover medical and other expenses, some are willing to consider becoming landlords and landladies rather than selling in a tight market.

 

      And the more homes become rental properties, the more acceptable that alternative will look to homeowners, especially if they are empty nesters who might be comfortable downsizing into an apartment of their own, or using rental income from houses to cover the cost of condos.

 

      What’s more, the new reality of renters paying far less for their quarters than owners with mortgages will likely not change much until or unless the Federal Reserve Board drops interest rates far below present levels.

 

      

     -30-       
Elias is author of the current book “The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government's Campaign to Squelch It,” now available in an updated third edition. His email address is tdelias@aol.com

HOUSING DENSITY REBELLION HAS A CHANCE

 

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, SEPTEMBER 15, 2023, OR THEREAFTER

BY THOMAS D. ELIAS
     “HOUSING DENSITY REBELLION HAS A CHANCE”

 

        Every poll shows most California adults favor the housing density laws that have emerged from the state Legislature with great regularity and fanfare over the last three years.

 

        Despite those findings, often showing 60 percent or more in favor, the rebellion against those laws has a decent chance of success.

 

        It’s a matter of what’s at stake and who will eventually vote on the potential landmark initiative to cancel out the new laws where they conflict with local land use ballot measures passed in many cities and counties.

 

        Polling on housing density laws has usually been done in general terms, with brief explanations of the new measures not mentioning the instability and constant variation in need estimates from state government.

 

        Those surveys often don't distinguish likely voters from residents who aren’t even registered to vote. Nor do they note whose life savings are invested in their homes and who is now renting. They also do not mention the changes already wrought by the new housing laws in many once-bucolic neighborhoods.

 

        But there’s a way to evaluate who might vote and how they’ll lean if the new initiative, which states simply that “local land use planning or zoning initiatives approved by voters shall not be nullified or superseded by state law,” makes the November 2024 ballot:

 

        Check out what their stake might be in its outcome.

 

        This is where things begin to look optimistic for the measure. A new study from the UC Berkeley Institute of Governmental Studies reveals that the vast majority of California’s most regular voters have a large stake in matters of preserving neighborhood character and ambiance.

 

        Only 39 percent of registered voters have voted in at least five of the last seven elections, thus making them almost certain to vote next fall in the presidential election of which this initiative seeks to be part.

 

        Out of that 39 percent, seven of 10 are 50 or older and seven of 10 are also white. Fully 68 percent of this cohort own their homes and 55 percent are college graduates.

 

        Taken together, these facts indicate a very large percentage of those certain to vote will feel they have a large stake in defeating this measure.

 

        Yes, for some, laws like the 2021 SB 10, which allows as many as six dwelling units on virtually all lots that now hold just one home, represent a chance to sell out to a developer and get rich quickly, as their age and home ownership status often has provided them significant equity they can now cash out.

 

        But for the many who plan to stay put the rest of their active lives, neighborhood stability will be a major interest. The currently proposed initiative is an effort to assure such stability, even if some call the status quo racist and exclusionary.

 

        (The measure is now undergoing the state's normal title and summary process in the office of state Attorney General Rob Bonta, a firm advocate of the laws this measure could cancel. Time will reveal the fairness of his work on this and whether it encounters a legal challenge.)

 

        The Berkeley IGS study shows homeowners are more likely to vote in large numbers than any other single California grouping, regardless of race. Hundreds of thousands of Blacks and Mexican- and Asian-Americans own homes in California and want to preserve the character of places where they have invested.

 

        Add to this the utterly whimsical numbers game played by the state’s Department of Housing and Community Development (HCD), in charge of enforcing the new laws, which amounts to a one-size-fits-all plan for increasing California’s housing density in current cities while leaving outlying ex-urban lands largely vacant.

 

        Back in 2018, Gov. Newsom claimed the state needed to build 3.5 million new dwellings by 2030, or about 300,000 per year. Even during today’s housing boom, only a fraction of that much has been built each year since. Meanwhile, HCD has revised its estimated need, first to 1.8 million, and now to 2.5 million.

 

        All of which might leave voters scratching their heads, especially those who already doubt the wisdom of greater density. Put it all together, and this measure definitely has a chance.  

       

-30-
    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

WHY NEWSOM, DESANTIS REALLY NEED TO DEBATE

 

CALIFORNIA FOCUS
FOR RELEASE: TUESDAY, SEPTEMBER 12, 2023, OR THEREAFTER

BY THOMAS D. ELIAS

 

    “WHY NEWSOM, DESANTIS REALLY NEED TO DEBATE”

 

        Think for a moment about a few political facts:

 

Here’s one: California Gov. Gavin Newsom is among President Biden’s most vociferous backers and it may now be too late for Biden to back out of next year’s campaign. Here’s another: Newsom’s second and final term as governor ends almost two years before the next presidential election.

 

So Newsom realized early on that if he ever wants to be president, he must establish himself as a major national Democratic figure independent of the office he now holds.

 

That’s the context of his putative upcoming debate with Florida’s Republican Gov. Ron DeSantis, who by now also must be aware that he, too, will not be running for president at this time next year and that if he’s ever to be president, he also might need to survive as a major party figure independent of his current office.

 

        That’s the context of the Newsom-DeSantis debate conceived by the Californian and agreed to by the Floridian, with only a few relatively minor details yet to be worked out.

 

        Newsom wants the debate in a Fox TV studio with no audience. DeSantis wants a live crowd at the debate, with cheering allowed, even encouraged. Maybe he figures he might be more credible if his folks yell louder than Newsom’s. DeSantis wants short videos at the debate’s start; Newsom wants four-minute opening statements.

 

        These demands both might be mistakes by DeSantis, who has sometimes been prone to error when under significant pressure.

 

        But the disputes are mere nitpicking – if DeSantis does not try to use them to somehow back out of the debate he agreed to right after Newsom issued his challenge on July 28.

 

        Newsom, of course, was glad to make DeSantis a prop in his effort to become a Democratic symbol.

 

        So what might these men debate in their encounter, likely to occur in Georgia, the lone state on both men’s lists of desired locations?

 

        Likely to be first is both governors’ handling of the coronavirus pandemic, which Newsom faced by closing down most businesses across his state, while DeSantis left almost everything in Florida open. Newsom required masking in most public places, while DeSantis signed a bill that bans masking requirements.

 

        DeSantis will brag that Florida suffered few financial ill effects from the viral invader, while Newsom will claim Florida saw about 40,000 more Covid deaths than if it had followed his model. If those are their claims, both will be correct. The question will be how many viewers believe the extra Florida deaths were worth the money saved.

 

        Then there will be censorship. DeSantis moved strongly against the Walt Disney Co. – his state’s largest employer through Orlando’s Disney World – when the company vocally opposed Florida’s year-old law banning classroom discussion below the fourth grade of gays or alternative lifestyles. There is no such ban in California.

 

        Florida also bans some books from schools, while Newsom says he’ll crack down on a Southern California school district that's attempting to follow a Florida-like plan.

 

        Republicans like to say Democrats limit freedom of speech via the so-called “cancel culture,” which they say deprives audiences of viewpoints unlike what is considered politically correct. Democrats retort that Democratic states neither impose bans on teaching certain topics in public schools nor ban books, while Florida and some other Republican-led states are doing both.

 

        So this may devolve into a dispute along the lines of the culture wars that have deepened what was already a major split among Americans.

 

        If it does, Newsom will be voicing views that polls show resonate with Democratic voters nationally, while DeSantis will be doing the same for Republicans.

 

        It all means this debate promises to outdo Newsom’s repeated ad campaigns in Texas and Florida in raising his national party profile. Chances are it might do the same for DeSantis, who has not articulated his views ably in the early stages of this year’s presidential campaign.

 

        In short, this debate probably won't do much to shape next year’s election, but it may draw some lines for a 2028 election if it makes either or both men symbols of their partys’ futures.

                 

    -30-

    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

STOP RETAIL THEFT? STORE OWNERS SAY THIS BILL WILL PROMOTE IT

 

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, SEPTEMBER 8, 2023, OR THEREAFTER

 

EDITORS: TODAY’S COLUMN FOCUSES ON A SINGLE LAW LIKELY TO HAVE MANY UNINTENDED CONSEQUENCES. THE PREVIOUS COLUMN FOCUSED ON THE GENERAL ISSUE OF PROPOSED NEW LAWS GETTING INADEQUATE ANALYSIS.

 

BY THOMAS D. ELIAS

     “STOP RETAIL THEFT? STORE OWNERS SAY THIS BILL WILL PROMOTE IT”

 

        While California has a long, sad history of poorly thought-out laws often passed for reasons of ideology, there is no way state legislators can pretend after passage that they weren’t warned about the current SB 553, the brainchild of Silicon Valley state Sen. Dave Cortese, a Democrat.

 

        His measure, which had a committee hearing just three days after a flash mob of 30 or more men and women pulled a snatch-and-grab robbery of a Nordstrom store in the Westfield Topanga Mall in the Canoga Park section of Los Angeles, passed the Senate on a 29-8 vote as a worker safety measure.

            It aims to prohibit employers from requiring retail workers to confront active suspected shoplifters. Designated security personnel would be exempted, but most stores don't have security officers for reason of cost.

 

        The very minimal consequence of this proposed new law would be that retailers of all types will keep almost all goods of significant value behind locked glass panels, thus preventing shoppers from examining possible purchases except under supervision and preventing many customers in grocery and drug stores from scrutinizing ingredient lists. It promises to make shopping a stark, inauspicious experience.

 

        Cortese says his bill aims to protect retail employees from violence by relieving them of any responsibility to confront thieves.

 

        “With growing awareness of workplace violence,” he said, “California needs smarter guidelines to keep workers safe…” He notes all employers would be required to train every worker on how to react to active shoplifting. “Let’s take every step to prevent another workplace assault or shooting,” he added.

 

        But retailers say the real life consequence will amount to an open invitation for thieves to take whatever they like, just like the latest large flash mob, which stole more than $100,000 worth of jewelry and designer goods from the Topanga Mall Nordstrom and then fled in a fleet of cars reportedly including multiple luxury BMW and Lexus vehicles.

 

        If they pass the Cortese bill, legislators won’t be able to shrug this off by saying they weren’t forewarned.

 

        For about 500 small business owners traveled to Sacramento from points like Fresno, Modesto and the North San Francisco Bay area to protest SB 553 and urge legislators to protect small businesses, not their predators.

 

        Said one demonstration organizer, “SB553 will create a field day for criminals to sue small business owners, giving criminals the double jackpot to steal from the business…and again by suing them in a shakedown lawsuit. All Californians will pay the price for billions of dollars lost to growing retail theft.”

 

        That statement is obviously correct on its very face. The fact the world’s most shoplifted Walgreen’s remains open in San Francisco is some kind of business miracle, and no one can be sure how long it will stay open. A former Westfield mall on that city’s busy Market Street became so vacant of stores because of theft and other business impediments that it was turned back over to the lender, with the lease holder not bothering to wait for foreclosure.

 

        The business owner demonstrators also asked why, when California has more worker safety measures in place than any other state, it needs more new rules.

 

        “(Legislators) should focus on protecting the public and businesses from violent criminals whose only intent is to steal merchandise,” the organizer added. “Let’s not do more to destroy the quality of life in our once-great state.”

 

        But just as police say last year’s SB 357, forbidding arrests for loitering to solicit sex, has created open season for pimps to further exploit prostitutes, so SB 553 figures to create an open season for thieves to ransack just about any store they please.

 

        Isn’t it about time legislators stepped back before knee-jerk voting for things that may look like mere do-gooder plans? If they did, they might actually realize their votes have real-world consequences.

 -30-

    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

 

NEW LAWS: INADEQUATE ANALYSIS YIELDS UNINTENDED CONSEQUENCES

 SOUTHERN CALIFORNIA FOCUS

FOR RELEASE: TUESDAY, SEPTEMBER 5, 2023, OR THEREAFTER

 

EDITORS: AS LEGISLATORS GET SET FOR THEIR USUAL SEPTEMBER BILL-PASSING FRENZY, TODAY’S COLUMN SPOTLIGHTS POORLY THOUGHT OUT LAWS. THIS WEEK’S SECOND COLUMN WILL COVER ONE CURRENTLY PROPOSED LAW.

 

BY THOMAS D. ELIAS
     “NEW LAWS: INADEQUATE ANALYSIS YIELDS UNINTENDED CONSEQUENCES”

 

          Here’s a reality that needs to soak into the consciousness of California lawmakers, the governor and voters who put them in office: This state needs far better analysis and vetting of new laws if it’s to avoid negative unintended consequences.

 

          And when we get solid analysis and reliable predictions of some consequences, we need to pay heed, not ignore reality.

 

          These facts of life are perhaps best illustrated by the 2014 Proposition 47, which ended felony status for thefts and burglaries involving less than $950 worth of goods and reduced some other felonies, like stealing a gun, to misdemeanors.

 

          One unintended consequence has been closure of some stores, notably Walgreen’s and Whole Foods outlets that suffered constant shoplifting and no penalties for thieves caught red-handed. That’s an inconvenience making life more complex from San Francisco to San Diego.

 

          This was predicted right in the ballot arguments on Prop. 47 mailed to all voters. “Reducing penalties for theft, receiving stolen property and forgery could cost retailers and consumers millions of dollars,” wrote Bill Dombrowski, president of the California Retailers Assn. Whether many voters noticed his analysis is questionable, considering the initiative passed by a 59-41 percent margin.

 

          That’s just one example of a law supported by politicians – including then-Gov. Jerry Brown, who wanted to cut prison populations – having severe consequences. For Prop. 47, these also include a major contribution to inflation, as many stores now factor losses from frequent and brazen shoplifting into prices and store closure decisions.

 

          At the same time, increased rates of rape and human trafficking have followed the 2016 passage of Proposition 57, which allows early releases of rapists, child molesters, hostage takers and those convicted of hate crimes.

 

          So…hate crimes last year reached record levels in California, and there is every indication that trafficking of prostitutes is also more common than before. Ballot arguments against 57 predicted both increases, but the measure, also backed by Brown as a prison-clearing measure, passed by 64-36 percent.

 

          State legislators and the governors who sign their bills into law have been just as derelict as the voters.

 

          Take last year’s Senate Bill 357, sponsored by Democratic state Sen. Scott Wiener of San Francisco, currently angling for the congressional seat of former House Speaker Nancy Pelosi, if she retires. The openly gay Wiener’s bills often are expressly aimed to further his perception of an LGBTQ+ agenda.

 

          When SB 357 decriminalized loitering with the intent to commit prostitution, his aim was to let gay men and women hang out on street corners trying to entice one another. It’s too soon for statistics, but police around the state say that the moment Gov. Gavin Newsom signed the measure, old-fashioned pimp-driven prostitution increased markedly.

 

          “On social media, the pimps were saying, ‘You better get out there and work because the streets are ours,’” one Los Angeles vice detective told the magazine City Journal. The pimps were right, the detective reported: Once the bill was signed, cops ceased arresting virtually anyone for this former crime, even before the law took formal effect.

 

          Police also reported pimps became more visible, often standing on nearby side streets as their “girls” worked streets long known as hooker hot spots. “It took away an enforcement tool,” said one Oakland anti-trafficking activist.

 

          The reported near doubling in numbers of young women loitering in fish-net dresses over skimpy g-strings was surely not Wiener’s intention, but it’s reality, as drivers can see when passing through vice-ridden parts of California cities. It’s an unintended, very foreseeable, consequence that many feel outweighs new rights for seekers of gay partners.

 

          Wiener and his allies have also produced unintended consequences with housing density bills they’ve pushed through: California now sports myriad new apartment buildings, most carrying large “vacancy” signs because rents remain too high for large numbers of those who need housing most. Wiener and fellow density advocates like Newsom, state Atty. Gen. Rob Bonta and state Senate President Toni Atkins didn’t intend that, but those thousands of signs are mute testimony to the emptiness within many new buildings.

 

          That’s another very predictable scene lawmakers didn’t notice ahead of time, and further evidence that rushed, minimally analyzed laws often work poorly.

 

-30-

    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

LATEST BAILOUT PLAN: UTILITIES SEEK YOUR INCOME INFO

 

CALIFORNIA FOCUS
FOR RELEASE: FRIDAY, SEPTEMBER 1, 2023 OR THEREAFTER

BY THOMAS D. ELIAS

        “LATEST BAILOUT PLAN: UTILITIES SEEK YOUR INCOME INFO”

 

        By law, federal and state tax returns are confidential. Even some presidential candidates, most notably Donald Trump in both 2016 and 2020, have managed to use this fact to hide their finances from voters.

 

        But now comes the latest bailout effort for California’s three largest electric utilities, Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric.

 

        The three worked together in 2022, lobbying a bill through the Legislature to partially link utility rates with household incomes. They sold their plan as a way to bring equity to power rates, where low-income families now pay about as much as the rich per kilowatt hour used.

 

        In reality, if this plan comes to pass, it will be yet another consumer-financed bailout for utility companies, akin to the state Wildfire Fund and the “loan” soon to go to PG&E to help it keep the Diablo Canyon Nuclear Power Station open an extra five years to help ease the state’s transition to renewables.

 

        While billed as advancing equity, the four-tiered fixed payment plan to be drawn up by the state Public Utilities Commission (PUC) will really act to discourage new rooftop solar installations and protect the big companies from the burgeoning Community Choice Aggregation movement taking hold from Sonoma to San Diego, Placer County to Pico Rivera. CCAs offer both conventional and renewable energy at somewhat lower costs than the utilities charge.

 

        The latest plan depends completely on utility company knowledge of each customer’s income. The four tiers are designed to make consumers pay set fees for being hooked up to the state electric grid, ranging from a low of $15 per month up to $92 monthly. The companies say that will be accompanied by lower rates per kilowatt hour used, but anyone who knows the sordid history of electric rate making in California will understand lowered usage rates will soon rise right back to today’s levels or higher.

 

        None of this, however, can happen without the utilities knowing the incomes of families and businesses that are their customers.

 

        The Legislature assigned the PUC to decide how these huge companies get that information. That’s a form of putting the fox in charge of the henhouse, considering the commission’s long history of corruption, scandal and favoritism of utilities over their customers.

 

        This is the agency that was caught conspiring with SoCal Edison to force consumers to pay the vast majority of the cost of dismantling the San Onofre Nuclear Generating Station after an Edison blunder disabled it. It’s the same outfit that has never significantly punished PG&E for its manslaughter convictions in the Camp Fire that destroyed the town of Paradise in 2018 or hit hard at Edison for its part in igniting fires in Malibu and elsewhere. It’s the agency where a commissioner who formerly represented the Cruise driverless car company just voted for letting it operate limitless vehicles in San Francisco.

 

        The five PUC commissioners could mandate an honor system, asking each electric user their level of adjusted gross income. But anyone who knows human nature will understand that many customers would low-ball their incomes.

 

        They could ask the state Franchise Tax Board to provide income levels to the companies, despite laws assuring confidentiality. But even if the tax board could securely turn over the information, there’s no guarantee utility company employees won’t leak some folks’ information.

 

The PUC could demand consumers show copies of tax returns in order to start or maintain service, but that could also subject taxpayer confidentiality to the whims of utility workers.

 

        Any such tactic would certainly produce a blizzard of lawsuits protesting the obvious contradiction with privacy assurances.

 

        But without solid income information, there’s no way utility commissioners can assure anyone they’re even trying to equalize electric price burdens among various economic classes.

 

        So the PUC – so far completely mum on this key new responsibility handed it so blithely by the Legislature and Gov. Gavin Newsom – has a problem.

 

        Whatever it does will cut into its already shaky credibility. Far better to scrap this idea and develop a completely different plan to assure electric equity, even if that would mean admitting a mistake and then starting afresh.

 

    -30-

    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.